Something to keep an eye on in the coming months. Uncertain impact on Flagstaff real estate market and elsewhere
Fannie Mae and Freddie Mac will merge some operations by starting a third company, which will take over some joint functions. The idea is to begin a transition, said the chief of the Federal Housing Finance Agency in an announcement March 4, 2013. The idea — to combine some of the back-office functions which both companies perform separately – sounds laudable. Such combinations can create efficiencies and save costs.
The concern is whether the combination will result in identical loan standards. In the current market, where most loans are originated through Fannie Mae, some borrowers can’t meet Fannie Mae’s standards but can meet the slightly different standards of Freddie Mac. We don’t need to return to the no-doc, crazy loan standards of the last mid-decade, but we also certainly don’t need to make getting home loans more difficult than they are right now.