Fannie-Freddie Regulator Said to Plan to Stay On Under Trump

On December 15th, Bloomberg reported that Mel Watt, Director of the Federal Housing Finance Agency (FHFA) announced to FHFA staff that he intended to serve out his 5-year term, which ends in January 2019. The article notes that as the director of an independent agency, Watt does not serve at the will of the President. However, FHFA has the ability to affect a large segment of the economy through its role as conservator and regulator of Fannie Mae and Freddie Mac, including mortgage rates and credit availability.

According to the article, Trump’s administration may need sign-off from Watt in order to implement policies like releasing the GSEs from conservatorship, a position for which Treasury nominee Steve Mnuchin indicated support in November. The article notes that while Watt believes FHFA and Treasury have the ability to end the GSE conservatorships, he has consistently stated his preference for Congress to determine housing finance reform, as well as his concern over what the future state of housing finance would look like in the absence of Congressional action.

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