Who Caused The Mortgage Meltdown

Who Caused The Mortgage Meltdown

HUD's Regulation of Fannie Mae and Freddie Mac

Regulatory Reading Room
Housing Goals Information

Pursuant to the Housing and Economic Recovery Act of 2008 (HERA), which became law on July 30, 2008, HUD's regulatory responsibilities

over Fannie Mae and Freddie Mac (government sponsored enterprises or GSEs) have transferred to a new regulator, the Federal Housing

Finance Agency (FHFA), effective immediately. This means, among other things, that the FHFA assumed responsibility for the affordable

housing goals. (The housing goals were established under the Federal Housing Enterprises Financial Safety and Soundness Act of 1992. The

new law retains the housing goals through 2009, but has redefined them for subsequent years.)

Prior to HERA, the Secretary of HUD was the mission regulator for the GSEs, with oversight authority to ensure that both GSEs complied

with the public purposes set forth in their charters. HUD had general regulatory authority for oversight responsibilities, which included

establishing housing goals; monitoring and enforcing compliance with housing goals; new program approval; collecting loan-level data from

the GSEs on their mortgage purchase activities; making available to the public a database on non-proprietary GSE loan purchase data; and

ensuring GSE compliance with fair lending requirements. An independent office of HUD, the Office of Federal Housing Enterprise

Oversight (OFHEO) regulated the GSEs for safety and soundness by ensuring that they were adequately capitalized and operating their

businesses in a financially sound manner.

With the exception of fair lending oversight, which remains at HUD, HUD's mission oversight responsibilities, as well as OFHEO's safety

and soundness responsibilities, have been transferred to the FHFA.

Additional information regarding the role and function of the FHFA will be available on its website, currently in development. Upon full

implementation of the FHFA website, HUD will remove the links for "Regulatory Reading Room" and "Housing Goals Information" from this website.

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