Mortgage leaders react to FHFA’s ending of SPCPs
Pulte also said on Tuesday that he won’t cut the conforming loan limits, which are set at $806,500 in most parts of the country for loans bought by Fannie Mae and Freddie Mac.
As of Wednesday afternoon, FHFA had yet to issue any announcements regarding the policy changes through traditional channels of communication.
The Mortgage Bankers Association (MBA) supported the UDAP policy reversal, arguing that avoided unnecessary oversight and cost increases for consumers and lenders.
“MBA supports the rescission of this advisory bulletin and thanks Director Pulte for prioritizing this issue in response to our members’ concerns, which we raised at the time of the policy’s release in November and reiterated to the director immediately upon his confirmation,” said Bob Broeksmit, the trade group’s president and CEO.
The Community Home Lenders of America (CHLA) also supported the reversal.
“CHLA appreciates Director Pulte’s comments about not reducing the conforming loan limit, which is consistent with our priority of not reducing the GSEs’ footprint — and we also appreciate the scrapping of the duplicative UDAP provisions,” CHLA executive director Scott Olson said.
“The slew of other actions yesterday represent a kind of pruning of the tree — focusing Fannie and Freddie on their core housing mission — so we think FHFA is headed in the right direction.”
Questions about SPCPs
In regard to special purpose credit programs, MBA shared a blanket statement with HousingWire, which read: “Even before FHFA encouraged the GSEs to support them, MBA in the past has promoted SPCPs as a tool to increase mortgage credit availability to underserved communities. We launched a toolkit with NFHA (the National Fair Housing Alliance) in 2022 for lenders interested in using them.”
Ending SPCPs means eliminating initiatives designed to provide targeted financial assistance — such as loans or credit — to historically underserved or disadvantaged groups. These programs are often used to promote fair lending and expand access to credit for minorities, low-income borrowers or specific communities that face systemic barriers.
While Pulte’s directive did not explicitly address which SPCPs would be cut, nor whether state-level programs or lender-operated programs could continue to operate, a source with knowledge of the policy change said that only Fannie’s Home Ready First and Freddie’s Borrow Smart Access programs are being impacted.
“We need more information,” said Jennifer McGuinness-Lubbert, CEO of Pivot Financial. “We have to confirm specifically what programs this order is relevant to, and then once those are identified, we can assess the impact of them being terminated. I think, right now, in the absence of that explicit answer, the markets are just going to create what-ifs.”
McGuinness-Lubbert said these “what-ifs” are creating worry and distracting from other available mortgage credit programs.
“There are other products and programs such as state-level down payment assistance programs. This order specifically says SPCPs supported by the enterprises. It doesn’t necessarily say in partnership,” she added. “So it will not necessarily undo state-level down payment assistance. This could just be a sign that Pulte is saying to get your down payment assistance from the state.”
Brendan McKay, chief advocacy officer for the Broker Action Coalition (BAC), also pointed out that the FHFA has yet to release a list of the programs being affected or which programs are considered SPCPs.
“We understand the reasons for the administration wanting to do it in these particular programs, but we also know that Fannie and Freddie are very profitable, and we would hope that if money was being taken off the table, that money would be repurposed in other ways to make it easier for Americans to become homeowners,” McKay said.
“I would be hopeful to see an update from FHFA clarifying the language, and instead of having it vary from one lender to the other, just be like, ‘Everyone has until this date to deliver these loans for securitization.’ This situation’s very fluid, and I’m learning more as things go on,” he said.
Others are concerned that SPCPs being taken off the table will further restrict access to homeownership. The National Association of Mortgage Brokers (NAMB) said it is “concerned” by the decision.
“These programs have served as critical tools in expanding access to affordable homeownership, particularly for first-time and low- to moderate-income homebuyers,” NAMB said in a statement.
NAMB President Jim Nabors said that the association will continue to promote responsible lending.
“NAMB remains steadfast in …. ensuring all Americans have access to mortgage financing. In addition to advocating for affordability, NAMB continues to lead regulatory initiatives that strengthen consumer protection, improve industry compliance, and support a sustainable mortgage ecosystem,” he said.
“We welcome the opportunity to engage with FHFA, policymakers, and industry partners to discuss constructive paths forward that preserve affordability, foster innovation, and support homeownership for those who need it most.”
