In a long awaited speech this morning, new FHFA Director Mel Watt laid out several changes in the direction for Fannie Mae and Freddie Mac from that proposed by former Acting Director Edward DeMarco. The most significant of which deals with loan limits. Watt will not force the Agencies to reduce their current loans limits, as DeMarco had planned. In addition, Watt proposed a renewed focus on expanding credit availability, loosening rules requiring loan buy-backs, and said he will seek public input before any increase in guaranty fees.
Over the weekend, incoming FHFA Director Mel Watt stated that as soon as he is sworn in, he intends to delay the implementation of the loan-fee increases as were recently announced by outgoing Director Edward DeMarco. It is believed that the delay will cover increases to both the guaranty fee and the loan level price adjustments. It was not clear if Watt’s announcement meant he will also delay DeMarco’s planned elimination of the .25% Adverse Market Delivery Charge (for all but four states). Watt said he needs time to “evaluate fully the rationale for the plan".