Hearing Preview: FHFA Oversight Hearing with Director Thompson

Today, Federal Housing Finance Agency (FHFA) Director Sandra Thompson testifies before the House Financial Services Committee at a hearing.

Congressional Republicans and the media have expressed concerns at FHFA’s loan level price adjustment (LLPA) changes that went into effect on May 1. Republicans in Congress have also shared concerns about the process leading to the changes and the lack of publicly available data to support the need for an updated LLPA matrix. Additionally, stakeholders shared concerns that lower loan pricing for lower FICO, higher LTV borrowers will endanger the GSEs and the overall mortgage market. Congressional Democrats, including House Financial Services Committee Ranking Member Maxine Waters (D-CA) have issued statements of support for FHFA or stayed silent.

Director Thompson is respected on both sides of the aisle as an experienced and competent leader. However, she will face intense questioning today about her leadership, the LLPA changes, the Equitable Housing Finance Plans approved by FHFA, agency transparency and how the LLPA’s and other GSE policies inject risk in the housing finance system.