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CHLA Statement about FHFA Report on FHLBank System

(Washington D.C.) – CHLA released the following statement on the FHFA Report about the FHLBank system: 

“In light of FHFA’s decision to defer to Congress on IMB membership in the FHLB system and the continued obligation of IMB servicers to act as bankers to defaulted mortgage borrowers, it is more important than ever for Ginnie Mae to expand the existing PTAP liquidity facility for solvent lenders, so they can meet higher advance responsibilities in turbulent markets,” said Scott Olson, Executive Director of CHLA. 

In January, CHLA submitted a letter to Ginnie Mae requesting the permanent implementation of the Pass-Through Assistance Program (PTAP) as it would “allow Ginnie Mae to preserve solvent IMBs as ongoing issuers mortgage-backed securities – instead of simply going directly to eliminating the issuer eligibility and transferring their MSR portfolios to situations where Ginnie Mae may have concerns about an issuer making timely advances.” This would also reduce Ginnie Mae losses by preventing the need for MSR transfers, thus reducing the opportunity for loss.