GSE Reform, CFPB Underwriting Rule are on Collision Course

As Congress and the Trump administration chart a future for the government-sponsored enterprises, they face a fast-approaching deadline when a huge chunk of Fannie Mae and Freddie Mac's loans could be in violation of federal underwriting requirements.

The White House and Senate Banking Committee are pursuing parallel tracks to end the GSEs' federal conservatorships. Any resulting plan must deal with whether GSE-backed mortgages are still exempt from the Consumer Financial Protection Bureau's Qualified Mortgage rule.

The exemption — known as the GSE "patch" — sunsets in January 2021 or when the conservatorships end, whichever comes first.


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