Sweeping regulatory proposals from President Donald Trump and the growing presence of Elon Musk's Department of Government Efficiency have shaken up the mortgage industry, from remolding the Consumer Financial Protection Bureau to widespread federal layoffs.
As agencies thin out staff numbers, and economic outlook remains murky, lenders are bracing for a storm.
In February, roughly 25% of
Layoff rumors have been circling the
Not surprisingly, proposals from the
"There is growing consensus to reform FHA and Ginnie Mae. … All we ask is for this to be done in a balanced manner, which both streamlines operation of these programs and maintains their critical role in making homeownership a reality for millions of American families," Scott Olson, executive director for the Community Home Lenders of America, told National Mortgage News.
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Markets haven't been faring that much better.
Both confidence levels among U.S. homebuilders and
Findings from the National Association of Home Builders and Wells Fargo recorded a five-point drop in the organizations'
"While builders hold out hope for pro-development policies, particularly for regulatory reform, policy uncertainty and cost factors created a reset for 2025 expectations," NAHB Chairman Carl Harris, a custom home builder from Wichita, Kansas, said in a prepared statement.
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Below are expert insights into the latest legislative moves out of Washington D.C. that stand to uproot the mortgage markets.
HUD and DOGE join forces to review agency spending
As the Trump Administration plans to cut roughly $260 million in costs across the Department of Housing and Urban Development, agency leaders are working with officials from Elon Musk's Department of Government Efficiency to see where reductions can be made.
The joint task force will report to HUD Secretary Scott Turner, with various news outlets reporting that the agency plans to cut roughly half of its 9,600 workforce while DOGE officials reach out to individual employees asking for
"Thanks to President Trump's leadership, we are no longer in a business-as-usual posture and the DOGE task force will play a critical role in helping to identify and eliminate waste, fraud and abuse and ultimately better serve the American people," Turner said in a February
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Ex-FHFA chief Mark Calabria returns to government work
Formally announced by the
Calabria's background includes roles as "a senior aide to the United States Senate Committee on Banking, Housing and Urban Affairs and served as the Deputy Assistant Secretary for Regulatory Affairs in the Office of Housing at the U.S. Department of Housing and Urban Development," according to the announcement.
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What does the future of tariffs look like under Commerce' Lutnick?
Mortgage experts are reviewing the newly confirmed Department of Commerce Secretary Howard Lutnick's past for clues on what the future of tariffs and a possibly reformed private mortgage market could look like.
Lutnick's tenure as chair and chief executive of Cantor Fitzgerald has come into the conversation surrounding the mortgage-backed securities arena, as industry advocates weigh the resurgence of Trump policies against Lutnick's experience.
More importantly, his support for controversial steel and aluminum tariffs has advocates with the
"The policies outlined by this administration will raise prices on everyday goods, and have the potential to make housing and energy more expensive," Sen. Jacky Rosen, D.-Nev., said during Lutnick's confirmation hearing.
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Home lenders to CFPB: Take it easier on IMBs
As the Consumer Financial Protection Bureau continues its metamorphosis, advocates with the Community Home Lenders of America have petitioned the agency to reform four key areas of priority to benefit independent mortgage bankers.
In its
"Every IMB, no matter how small or how few loans it originates, is redundantly subject to exams and actions by the CFPB with respect to all federal consumer protection laws," according to the letter.
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The domino effect of GSE privatization on credit-risk transfer ratings
Analysts from
Specifically, S&P experts are looking at the effect of exits on the ratings on credit risk transfers from both parties.
"While privatization could take on various forms, we believe that any housing finance reform would support the existing (and possibly future) senior obligations of the GSEs, given the outsized footprint of the GSE MBS market," according to the cohort of S&P analysts, led by primary credit analysts Jeremy Schneider and John Schuk.
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