GSEs

The legislation has support among Republicans, who hold a slim majority in the chamber.

During her opening remarks before lawmakers Tuesday, the head of the Federal Housing Finance Agency reiterated that borrowers with strong credit profiles are not being penalized to benefit those with poorer scores.

Her statement calls out "a fundamental misunderstanding about the fees" following concerns expressed by two congressmen and others about their impacts.

Two housing-policy experts whose previous recommendations have been closely followed by the Biden administration are defending the Federal Home Loan Banks, raising the stakes in a debate over whether a major overhaul is needed.

The group, led by Senate Banking Chairman Sen. Sherrod Brown, said nonperforming loans sold to single family housing rental businesses or private equity firms results in the displacement of homeowners.

The Federal Housing Finance Agency got an earful from housing experts at a listening session intended to aid a comprehensive review of the financing system.

The former head of the agency said a decision last year to suspend caps on investor loans has further induced demand in an already hot market. Other experts say a supply-demand imbalance is the true driving force.

Federal Housing Finance Agency Director Sandra L. Thompson told lawmakers on Wednesday that the agency would consider “foundational questions about mission, purpose, and organization” of the Home Loan Bank System.

Former Federal Reserve Gov. Daniel Tarullo and two Fed economists argue that the Federal Home Loan banks have expanded into activities that pose risks to financial stability.

Former FHFA director Mark Calabria said the mortgage market was a “ticking time bomb” on track for a 2008-like crisis. Other experts foresee a tamer end to the bull housing market.