Fannie Mae issued an official request for proposal, seeking contractors for its rollout of a controversial title-waiver pilot, as well as comments on other homeownership affordability solutions.
Interested parties must register through the government-sponsored enterprise's Procureone contractor platform by July 11. The RFP will remain open for responses until July 26. Fannie Mae previously said it hoped to hear from companies "that have viable technology solutions for managing title-related risk and reducing closing costs for borrowers."
The GSE's new request adds details to an announcement issued in mid April and divides the RFP into two sections. The first seeks to identify suppliers possessing or currently utilizing instant title engines that could serve Fannie Mae's program.
"The second section seeks input from a diverse group of industry participants on ways to reduce title, escrow and other closing costs through technology, process improvements, alternative title products, alternate rate and fee structures or other changes to make homeownership more affordable for borrowers in a safe and sound manner," the request said.
The RFP follows up on the Federal Housing Finance Agency's original notice in early March that it planned to pilot a title waiver program, even as similar plans had previously been floated and abandoned. The FHFA is responsible for oversight of Fannie Mae, and its counterpart, Freddie Mac. Included in the GSEs' missions is the creation of equitable and sustainable access to homeownership.
After being proposed as well as referenced multiple times in various White House addresses, the program encountered immediate pushback from the leading title insurance and mortgage industry trade groups and Republican members of Congress. At the same time, groups representing smaller lenders voiced their support.
The program would permit waivers or alternative options in lieu of title insurance only for conforming refinance transactions. Currently, refinance applications make up about one-third of new origination volume.
In late 2023. Fannie Mae had previously updated its selling guide to allow for acceptance of attorney-opinion letter alternatives in conjunction with mortgages used to finance some condominium purchases and properties located in homeowner association communities.
Technology-related businesses involved in the title alternative space that potentially could serve as contractors include the likes of iTitleTransfer and Voxtur Analytics. The latter company, however, may have stepped back its investments in the space since the departure of its former CEO in mid 2023. Voxtur is also currently embroiled in a battle with a group of dissident shareholders.
As it focuses on creating affordable housing opportunities, the FHFA named 19 real estate leaders this week to a new advisory board to provide guidance on related issues. The agency is also seeking input on how the Federal Home Loan Bank system, which it governs, can better serve the public. Earlier this year, FHFA Director Sandra Thompson suggested the mandatory percentage of profit each FHLB should contribute toward affordable homeownership be doubled from 10% to 20%.
