Amid a series of shakeups last week at the government-sponsored enterprises (GSEs) and its regulator, the Federal Housing Finance Agency (FHFA), two office closures inside the agency could hamper its fair lending and data gathering efforts that support the broader mortgage industry.
The Trump administration has moved quickly to scale back the headcount of the federal workforce across multiple agencies and departments. And FHFA Director Bill Pulte, still relatively fresh from the Senate confirmation process, has made moves to realign the regulator and the GSEs with the administration’s priorities.
Pulte has reportedly moved to cut FHFA staff, shutter some of its divisions and impose a return-to-office mandate at Freddie Mac. At the FHFA, the offices that are being closed — the Division of Public Interest Examination (DPIE) and the Research and Statistics Division — could have the effect of “imperil[ing] important research on the U.S. mortgage market and fair lending,” according to an analysis by Bloomberg Law.
DPIE was primarily focused on ensuring the GSEs’ compliance with fair lending and consumer protection laws. Employees from that office who were placed on administrative leave have been routed to other divisions inside the agency, sources told Bloomberg.
The cuts at the research arm will also impact statutorily mandated work, the report said.
“The economists on the chopping block did research on mortgage markets, including reports on affordable housing and fair lending, for public consumption but also for internal use at the FHFA,” the report explained. “Some of that work, such as on interest rate disparities, was mandated by Congress.”
While the Home Mortgage Disclosure Act (HMDA) mandates the submission of key data to the Consumer Financial Protection Bureau (CFPB), FHFA researchers gleaned additional information based on confidential supervision, Bloomberg said.
“We are streamlining our agency and its naming conventions, but FHFA will continue to follow all mandated laws, including statutory requirements for statistics and reports,” the FHFA told the outlet in a statement.
Certain data functions are being preserved, since FHFA examiners who inspect the financial health of the GSEs are being moved “to a different unit within the agency,” based on input from sources. The FHFA’s House Price Index, a key data metric, continues to be produced.
Pulte has moved swiftly to reshape the posture at the GSEs. Last week, a top HR official at FHFA was fired and its chief operations officer was placed on administrative leave, alongside moves to oust several leading executives at Freddie Mac. Earlier that day, Pulte placed dozens of employees at the GSEs on leave.
Pulte is also mandating a return to the office at the GSEs. Freddie Mac’s full-time office return is expected in May, while Semafor reported that a return-to-office mandate at Fannie Mae goes into effect Monday for workers in Washington, D.C.; Reston, Virginia; and Plano, Texas.
There is room for roughly 5,300 employees to work in the office, but the company reportedly has an estimated 7,700 employees.
