The Federal Housing Finance Agency (FHFA) announced the government-sponsored enterprises Fannie Mae (OTCMKTS: FNMA) and Freddie Mac (OTCMKTS: FMCC) are updating their Private Mortgage Insurer Eligibility Requirements (PMIERs).
The GSEs first issued their PMIERs in 2015 with the goal of providing the financial and operational standards that private mortgage insurance companies must meet to provide insurance on mortgage loans acquired by Fannie Mae and Freddie Mac. According to a statement from the FHFA, the updated standards “differentiate between bonds based on credit quality and liquidity. The updates also establish limits for assets backed by residential mortgages or commercial real estate to mitigate the impact if such assets lose value during periods of housing stress.”
The updated standards will be implemented through a 24-month phased-in approach, with a fully effective date of Sept. 30, 2026.
“Financially sound private mortgage insurance companies play a critical role in a healthy residential mortgage market that helps borrowers, including first-time homebuyers, achieve their homeownership dreams,” said FHFA Director Sandra L. Thompson. “These updates represent an ongoing commitment to the safety and soundness of the Enterprises, ensuring that their private mortgage insurer counterparties have the necessary financial strength to pay claims in a wide range of economic environments.”
