Fannie Mae-No Politics (FNMA)

[navycmdr]

Bove called Fannie Mae's and Freddie Mac's opposition to the FHFA's proposed capital rule "an unprecedented step" because they officially disagree with the agency that oversees them. Both GSEs wrote comments about the capital rule, and they both said they will have to increase mortgage costs if the rule is established as it is currently written.

Fannie and Freddie are asking that the capital rule be "dialed back." They agree with former Freddie Mac CEO Don Layton and Phil Swagel of the Congressional Budget Office, both of whom have raised the same question about the proposed capital rule.

The GSEs said if the capital rule is put in place as currently written, they would have to increase their mortgage fees by 15 to 35 basis points. They also said this would cause their businesses to shrink and force borrowers and lenders to tap other sources for mortgage funding.

Calabria has said previously that he wants more competition in the mortgage space. However, Pagliara and Grant Stark at CapWealth have said they don't believe other lenders want to compete for 30-year mortgages, especially while interest rates are low because they don't want to keep low-rate loans on their books for 30 years.