WASHINGTON — The Federal Housing Finance Agency said Monday it will give at least six months’ notice of any drop in the loan sizes that Fannie Mae and Freddie Mac will accept.
FHFA chief Edward DeMarco spoke to housing finance executives from banks and credit unions attending the annual meeting of the Mortgage Bankers Association in Washington.
His agency is the regulator and conservator of secondary mortgage giants Fannie Mae and Freddie Mac.
DeMarco put his remarks about the size of loans which the GSEs accept into the context of shrinking their footprint in the secondary mortgage market, something he called “essential” as a part of the mandate for conservatorship.
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Currently the GSEs limit the size of single-family home they accept to $417,000 for the majority of markets and $625,000 for loans in higher-priced mortgage markets.
DeMarco did not say what the new limits would be, but said they would be announced for 2014 in late November. He said the agency would seek to leave plenty of time for the market to handle the change, reminding the audience that the agency's third goal as the GSE's conservator is to maintain market stability.
“We will continue to strive to keep the market well informed about changes approaching,” DeMarco said.