FHFA Issues Proposed Rule Regarding Fair Lending Oversight
The Federal Housing Finance Agency (FHFA) recently issued a proposed rule regarding fair lending, fair housing, and Equitable Housing Finance Plan requirements. The proposed rule would apply to Fannie Mae and Freddie Mac (the GSEs), and certain sections would apply to Federal Home Loan Banks (the Banks) (collectively, the Regulated Entities). The deadline to submit comments on the proposed rule is June 26, 2023.
Among other things, the proposed rule would formalize some of FHFA’s existing practices. For example, the rule would codify, (i) FHFA’s fair lending oversight requirements for the Regulated Entities; (ii) the requirements for the GSEs to maintain Equitable Housing Finance Plans; and (iii) the requirements for the GSEs to collect, maintain, and report data on applicants’ language preferences, housing counseling, and homeownership education from the Supplemental Consumer Information Form (SCIF).
Additionally, the proposed rule would expand requirements for the GSEs related to fair lending compliance and provide greater oversight and transparency regarding the GSEs’ Equitable Housing Finance Plans. The FHFA Director said “[t]he proposed rule will help FHFA ensure that our regulated entities operate in a safe and sound manner as they comply with fair housing laws and serve the public interest.” Note, FHFA is also soliciting feedback on whether the Banks should be required to comply with a framework similar to that of the Equitable Housing Finance Plans by regulation.