Highlights:
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The FHFA statement may impact institutions' ability to sell residential mortgage
loans to Fannie Mae and Freddie Mac.
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The FHFA statement advises that certain energy retrofit programs use the
municipal tax assessment process to ensure repayment, which results in a
priority lien status that supersedes the position of existing properly recorded
lien holders.
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The FHFA statement indicates that underwriting and consumer protection
standards, as well as energy retrofit standards, are being developed for these
programs to ensure borrowers have the ability to repay the new monies in
addition to existing obligations and consumers receive appropriate
truth-in-lending disclosures. The FDIC shares the FHFA's concerns about the lack
of appropriate underwriting and consumer protection standards.
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The FHFA statement directs Fannie Mae, Freddie Mac, and the Federal Home Loan
Banks to take specific actions that protect their operations.
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The FHFA's statement is available at www.fhfa.gov/webfiles/15884/PACESTMT7610.pdf.
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This alert is provided for informational purposes.
Distribution:
FDIC-Supervised Banks (Commercial and Savings)
Suggested
Routing:
Chief Executive Officer
Chief Lending Officer
Contact:
Beverlea S. Gardner, Senior Examination Specialist, at BGardner@FDIC.gov or (202) 898-3640
Note:
FDIC financial institution letters (FILs) may be accessed from the FDIC's Web site
at www.fdic.gov/news/news/financial/2010/index.html.
To receive FILs electronically, please visit http://www.fdic.gov/about/subscriptions/fil.html.
Paper copies of FDIC financial institution letters may be obtained through the
FDIC's Public Information Center, 3501 Fairfax Drive, E-1002, Arlington, VA 22226
(1-877-275-3342 or 703-562-2200).
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