The Credit Union National Association (CUNA) will attend an industry roundtable April 25 discussing the proposed rule on Fannie Mae and Freddie Mac’s “duty to serve” (DTS). Hosted by the Financial Services Roundtable, an advocacy organization, the discussion will focus on possible alternative approaches for Fannie and Freddie to evaluate DTS performance.
Otherwise known as the Enterprises, Fannie and Freddie have a statutory duty to serve very low-, low- and moderate-income families. The Federal Housing Finance Agency (FHFA) sought comments earlier this year on a proposal that would provide DTS credit for eligible Fannie and Freddie activities.
The proposal also establishes a method for evaluating and rating the Enterprises’ compliance with the duty to serve each underserved market.
In its comment letter sent in March, CUNA stated that enabling and maximizing purchase and guaranteeing private market loans is the best approach for the FHFA’s oversight of the Enterprises. Further, CUNA believes that this objective is not inconsistent with the Enterprises meeting their statutory DTS mission.
CUNA is also concerned that looming reforms of Fannie and Freddie make it very difficult to articulate the best public policy that will help create a robust and stable secondary market that is supportive of lenders.