CHLA Writes FHFA to Express Concerns about Fannie Mae $1 Billion Blackstone Deal

CHLA Writes FHFA to Express Concerns about Fannie Mae $1 Billion Blackstone Invitation Homes Deal

Questions Posed on Mission, Risk, and 

Impact on Consumers and Communities

 

Contact: Scott Olson                                                                           For Immediate Release
571-527-2601                                                                                      March 15, 2017

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The Community Home Lenders Association (CHLA) today sent a letter to FHFA Director Mel Watt expressing concerns about reports that Fannie Mae is providing $1 billion to the Blackstone Group’s Invitation Homes unit to fund their portfolio of single family rental units.
“The Community Home Lenders Association (CHLA) writes to express our concerns about reports that Fannie Mae is providing $1 billion in financing to Invitation Homes, a unit of the Blackstone Group,” the CHLA letter states.  
“Specifically, we write to ask a series of questions about this transaction with regard to its consistency with mission, its risk, its impact on communities and consumers, and its lack of transparency.”
 
The letter lays out specific concerns about the reported transaction, including:
 

  • Consistency with Mission – the transaction appears to move Fannie Mae from traditional financing of small investor-owned properties to a $1 billion refinancing of scattered site single family rentals
  • Risk.  The creation of $1 billion in counter-party exposure to a single borrower, with the added challenges of managing a large portfolio of scattered site rentals and of unwinding them if there are financial problems.
  • Impact on Consumers and Communities – the potential impact of reducing home purchase opportunities and raising prices in strong markets, plus concerns about rental affordability,

The CHLA letter closes by asking FHFA a series of questions that focus on these three issues, and also inquires whether this signals a move away from serving small investors to serving large portfolio lenders, and about the apparent lack of transparency about the terms and availability of this type of transaction.
 

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