On July 1, the Federal Housing Finance Agency (FHFA) released a Policy Statement on its commitment to comprehensive fair lending oversight of Fannie Mae, Freddie Mac, and the Federal Home Loan Banks (collectively, “regulated entities”). The FHFA addressed its position on: (i) monitoring and information gathering; (ii) supervisory examinations; and (iii) administrative enforcement related to the Equal Credit Opportunity Act, the Fair Housing Act, and the Federal Housing Enterprises Financial Safety and Soundness Act. The FHFA added that the statement operates as a “foundation for future interpretations by the agency and its regulated entities.” Comments on the policy statement are due 60 days after publication in the Federal Register.
Putting it into Practice: This statement is the most recent pronouncement from the Biden administration on the critical issue of racial equity. While the FHFA’s supervisory authority under the policy statement is generally limited to the regulated entities, mortgage originators and servicers ought to be ready for any additional or heightened fair lending and fair servicing requirements that these regulated entities may impose and work with their compliance officers and counsel to anticipate increased fair lending scrutiny.