Rep. Carolyn B. Maloney (D-NY), Ranking Member of the House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises, today wrote the Federal Housing Finance Agency opposing further cuts to the multifamily businesses of Fannie Mae and Freddie Mac, the guarantors of $63 billion of loans backing multifamily apartment buildings per year nationwide.
"As the representative of 715,000 constituents residing in thriving urban neighborhoods in New York, where multifamily housing is our single family housing, I urge you to halt further cuts to the multifamily businesses at the GSEs," Maloney said.
Maloney noted that since implementing an arbitrary 10% cut in multifamily businesses for 2013, "an additional reduction further depresses the housing market nationwide, reduces the availability of rental housing, and actually harms the financial stability of Fannie Mae and Freddie Mac by limiting proven revenue-generating opportunities. While I strongly support housing finance reform that reduces taxpayers' exposure to the mortgage market, cutting the GSEs' multifamily business does not reduce the taxpayers' overall exposure, and is the exact opposite of what the FHFA should be doing as conservator of the GSEs."
The FHFA had requested public input on a proposal to further reduce the multifamily businesses of Fannie and Freddie in 2014. Possible options to contract the GSEs' multifamily businesses that the FHFA is exploring include restrictions on the length of loan terms, simplification and standardization of loan products, limits on property financing, limits on business activities; restrictions on the length of loan terms, simplification and standardization of loan products, and limits on property financing.