The Mortgage Bankers Association (MBA) has
reacted harshly to an announcement made yesterday by Edward J. DeMarco, Acting
Director of the Federal Housing Finance Agency.
In a speech
before an economic conference DeMarco said that FHFA, in its role as
conservator of Freddie Mac and Fannie Mae (the GSEs) would be setting up an
independent business entity to manage a new securitization platform for the
MBA's President and CEO David H. Stevens
issued a formal statement this afternoon which said the concept of a single
securitization platform further highlighted the need for a comprehensive discussion
among policymakers and stakeholders about the future of the GSEs and the
potential role of the government in housing markets.
Stevens said, "Piecemeal proposals without a
broader framework create uncertainty and raise more questions than they
answer. This latest proposal of a single platform and a new entity (owned
and funded by Fannie Mae and Freddie Mac) to manage it, is just one piece of a
much larger puzzle that impacts borrowers, lenders and the market as a
whole. What is the ultimate objective? How would the creation of
this new entity, owned by Fannie Mae and Freddie Mac, impact their potential
restructuring and how would it affect other market players like FHA and private
He complained that, in the four years since
Freddie Mac and Fannie Mae were placed into conservatorship there have been
countless proposals and ideas put forth by MBA and others on ways to
restructure the secondary market and that it is now time for action. "Proposals of this magnitude, he said, "need
a transparent process to engage with stakeholders, articulate objectives and
alternatives, and demonstrate that stakeholder concerns have been evaluated and
addressed." It is time for Congress and regulators to involve other
stakeholders and "move the ball forward.
Until this happens, the uncertainty in the markets will persist, and a
full recovery of the housing market will remain elusive."