Fannie Mae Subjects Broker-Involved Agency Loans to Pre-Review
By Andrew Coen November 7, 2023 7:22 pm
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The brokerage industry is facing increased scrutiny from the nation’s capital.
Washington-based Fannie Mae (FNMA) alerted lenders on Tuesday that all agency-backed loans involving brokers are now subject to pre-review, Commercial Observer has learned.
“The only exception are loans that were rate-locked and/or committed with Fannie Mae prior to today,” the statement obtained by CO said. “If the deal is current in underwriting, or a quote is outstanding, the transaction must be resubmitted for pre-review.”
The Fannie Mae statement was issued in the wake of Fannie’s government-sponsored-enterprise (GSE) rival Freddie Mac (FMCC) barring Meridian Capital Group from arranging further deals through lenders that are Freddie Mac sellers. Freddie took the action after a loan brokered on behalf of the GSE was called into question.
The action by Fannie Mae could have major repercussions for mortgage brokers involved with agency lending, according to Ira Zlotowitz, CEO of Gparency, which he founded in November 2021 with the goal of enabling developers to work directly with banks without broker fees.
“There will always be intermediaries, but the question is what title will they have and what will the fee structure be,” Zlotowitz said. “The market is questioning all these moves, but I think at the end of the day there will always be a need for it.”
It was unclear Tuesday evening if Freddie Mac would implement a policy similar to Fannie.
Officials for Fannie Mae and Freddie Mac did not immediately return requests for comment.
Andrew Coen can be reached at acoen@commercialobserver.com
