HR 258119th CongressIn Committee

To cancel certain proposed changes to loan level price adjustments by the Federal National Mortgage Association and credit fees charged by the Federal Home Loan Mortgage Corporation.

Introduced: Jan 9, 2025

Standard Summary

Comprehensive overview in 1-2 paragraphs

This bill would block the Federal Housing Finance Agency (FHFA) and the government-sponsored enterprises (GSEs)—Fannie Mae (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation)—from implementing the changes to the single-family pricing framework that FHFA announced on January 19, 2023. Specifically, it would nullify the related changes to loan level price adjustments (LLPAs) and the credit fees that were set out in the corresponding lender communications (Fannie Mae Lender Letter LL-2023-01 and Freddie Mac Bulletin 2023-1). In effect, the bill seeks to preserve the pre-2023 pricing framework and prevent the 2023 adjustments from taking effect unless Congress acts differently. The bill was introduced in the House on January 9, 2025, by a sponsor identified as Mrs. Bice and referred to the Committee on Financial Services. It would require passage by Congress and presidential approval to become law.

Key Points

1Prohibition on implementing 2023 changes: The FHFA and the two GSEs may not implement the January 19, 2023 changes to the single-family pricing framework.
2Nullification of related materials: The 2023 changes, along with the associated Lender Letter LL-2023-01 (Fannie Mae) and Freddie Mac Bulletin 2023-1, would have no force or effect.
3Scope: Applies to the changes in LLPAs and credit fees that were part of the 2023 pricing framework update for single-family mortgages.
4Regulatory and corporate actors affected: FHFA, Fannie Mae, and Freddie Mac (the “enterprises” under the Federal Housing Enterprises Financial Safety and Soundness Act of 1992).
5Legislative status: Introduced in the 119th Congress; would require approval from both Houses and the President to become law.

Impact Areas

Primary group/area affected- Homebuyers and borrowers seeking single-family mortgages, particularly those sensitive to pricing adjustments based on loan characteristics (e.g., credit score, loan-to-value ratio, occupancy).Secondary group/area affected- Mortgage lenders and originators who price loans using LLPAs and related credit fees; could face a shift in pricing guidance and cost structure if the 2023 changes are reversed or stay in place.Additional impacts- The FHFA and the GSEs would be constrained from adopting the 2023 pricing changes, potentially affecting the balance between risk-based pricing and mortgage affordability.- Market signaling and policy direction: The bill would represent a legislative preference to maintain the existing pricing framework rather than implementing FHFA-initiated updates, which could influence market expectations and competition among lenders.LLPAs (Loan Level Price Adjustments) are risk-based pricing adjustments added to mortgage loan prices based on borrower and loan characteristics (e.g., credit score, loan-to-value ratio, occupancy, loan type). They affect the interest rate and upfront costs a borrower pays.The “single-family pricing framework” is FHFA’s overall structure for pricing single-family mortgage purchases by Fannie Mae and Freddie Mac, including LLPAs and related fees.The “enterprises” refer collectively to Fannie Mae and Freddie Mac, which operate under FHFA’s supervision.

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