Outlook for Ending GSE Conservatorship Uncertain
Mike SP
Outlook for Ending GSE Conservatorship Uncertain
If former President Donald Trump is re-elected, there’s a possibility that the conservatorship of the government-sponsored enterprises will come to an end, according to Isaac Boltansky, a managing director at BTIG.
Speaking last week at the Mortgage Bankers Association’s secondary market conference in New York City, Boltansky noted that the Trump administration made substantial progress toward ending the conservatorship of Fannie Mae and Freddie Mac. He added that Mark Calabria, the head of the Federal Housing Finance Agency during the Trump administration, is looking for a different role in the potential next administration, but Trump could appoint someone else who believes that the conservatorship should end.
Jaret Seiberg, a housing policy analyst at Cowen, was more skeptical that a second Trump administration would be any more successful at ending the conservatorship than the first. “You had the perfect combination in the last Trump administration, with a [favorable] Treasury secretary in Steven Mnuchin and FHFA Director Calabria, and they couldn’t get it to the finish line.”
That was at least in part because of White House resistance, Seiberg said. “Because nobody is going to vote for you if you release Fannie and Freddie. You are, however, going to lose an election if somebody messes up the housing-finance system by freeing Fannie and Freddie.”
For more details, see the latest issue of Inside Mortgage Finance.
