The Federal Housing Finance Agency isn’t exactly a household name, but the government agency plays a significant role in whether you can buy the house of your dreams. Through its control of Fannie Mae and Freddie Mac, it helps create the guidelines and requirements that lenders use to approve most mortgage loans.
Under the Trump administration, the FHFA has shifted direction. Some say recent policy changes signal that current leadership is focused on running the agency more like a business than in the past.
“The thing I’ve noticed is a shift where we’re seeing less (emphasis) on housing affordability and more on operational efficiency,” says Doug Perry, strategic financing advisor at Real Estate Bees and managing broker with Qual-Cap, a boutique mortgage brokerage.
Recent changes made by the FHFA include the following:
— Rolling back Biden administration initiatives
— Changing credit score requirements
— Allowing cryptocurrency to be used as a qualifying asset
— Updating home appraisal forms
— Increasing HOA reserve requirements
— Indicating a willingness to partially privatize Fannie Mae and Freddie Mac
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Rolling Back Biden Administration Initiatives
“The Trump administration has been clearly concerned about the Biden administration’s efforts for diversity, inclusion and equity and climate change,” says Eric Chaffee, the John C. Hutchins Professor of Law for Case Western Reserve University in Cleveland.
Like other federal agencies, the FHFA has made a point of rolling back Biden-era requirements. These rollbacks include:
— Allowing condos to purchase roof insurance that has actual cash value coverage. ACV pays claims based on a roof’s current value, taking into account its age and condition. It is cheaper than replacement cost coverage, which will pay to replace a roof based on today’s prices.
— Withdrawing from the Network of Central Banks and Supervisors for Greening the Financial System, a group focused on managing environmental and climate risk in the financial industry.
— Adjusting the housing goals for Fannie Mae and Freddie Mac to reduce the target percentages for loans to low- and very-low-income homebuyers. Critics of this change say it could widen racial disparities in homeownership.
[See: Best Mortgage Lenders for First-Time Homebuyers]
Changing Credit Score Requirements
It used to be that conventional, conforming loans — which are the ones purchased by Fannie and Freddie — required homebuyers to have a credit score of at least 620. Now, Darren Tooley, senior loan officer with Cornerstone Financial Services in Southfield, Michigan, says he’s had applicants with credit scores as low as 520 approved for a mortgage.
Credit score requirements aren’t just getting lower. The FHFA has opened the door for lenders to move away from FICO credit scores and use one from VantageScore if they’d like. That competition could help lower one cost of applying for a home loan.
The cost of credit reports for lenders has jumped from $50 in 2022 to $250 today — and up to $540 for joint borrowers. Perry says there seems to be little reason for the price increase other than the fact that credit reporting companies can charge that much, and he appreciates that the FHFA is taking action that could help lower the cost.
Allowing Cryptocurrency as a Qualifying Asset
Home lenders consider a homebuyer’s assets when determining whether they qualify for a mortgage. Under a directive issued last year, Fannie Mae and Freddie Mac will consider cryptocurrency as a qualifying asset so long as it is stored on a centralized exchange regulated by the U.S.
In announcing the directive on social media, FHFA Director Bill Pulte said the move was being made to further President Donald Trump’s goal of making “the United States the crypto capital of the world.”
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Updating Home Appraisal Forms
For years, Fannie and Freddie have been working on a uniform appraisal form for all single-family and two- to four-unit properties. Use of the new form will become mandatory in November 2026.
“It doesn’t directly impact homebuyers,” Perry says. However, it may indirectly affect homebuyers’ costs as lenders make necessary updates. “The plus of it is that it gets us where data can be transferred electronically. The downside is that every lender needs to change its system to accommodate it.”
Those changes will come at a cost, and the price will invariably be passed on to homebuyers.
Increasing HOA Reserve Requirements
Another appraisal change is the elimination of a streamlined condo appraisal, Tooley says.
That is part of a larger set of reforms for condos that includes increasing HOA reserves from 10% to 15%. While some say the reforms are a step toward condo affordability, others caution that they could have the unintended effect of increasing costs for current homeowners and making it more difficult for buyers to get financing.
“It’s kind of hard to say (the impact) because the changes are relatively new,” Tooley says.
[HOA Fees vs. Mortgage Rates: Which Is Actually Driving the 2026 Affordability Crisis?]
Indicating a Willingness to Partially Privatize Fannie Mae and Freddie Mac
The FHFA was created in 2008 in the wake of the housing crisis and given the task of being the conservator of Fannie Mae and Freddie Mac, two government-sponsored enterprises that purchase and guarantee most mortgages in the country.
“They were put in conservatorship at the time because they were at risk of going under,” Tooley says. The FHFA’s initial role was to stabilize the housing industry. “Nowadays, it’s more about overseeing the two major government-sponsored enterprises,” according to Tooley.
The fortunes of the two enterprises have changed dramatically since 2008. “Fannie and Freddie are very, very profitable entities,” Perry says. “They’re incredibly profitable.”
That has led some in the Trump administration, including Pulte, to contemplate whether it is time to end the government’s conservatorship.
“They have been talking about taking it in a privatized direction,” according to Chaffee.
That could involve selling a small equity stake in the organizations, eventually returning the enterprises to private shareholders. That was how the enterprises were owned prior to 2008. Some worry that privatizing Fannie and Freddie could mean profits will take precedence over sound housing policy.
Balancing Affordability Goals With Business Interests
It isn’t just FHFA policies that are changing under the Trump administration. The agency’s management style is a departure from the methods used in the past.
“How regulatory changes are being announced is very different,” Chaffee says. Instead of traditional news releases, many updates are being shared by Pulte on the social media platform X.
Chaffee says Pulte is a “Trump loyalist,” a description he thinks the FHFA director would embrace. Before being named the agency director, Pulte founded an investment firm focused on the building industry and served on the board of Pulte Homes, one of the nation’s largest homebuilders.
That business background may be why Pulte seems more focused on the financial health of Fannie and Freddie than on affordability initiatives for underserved populations. Still, affordability remains a stated goal of the Trump administration.
Those goals can at times seem to be opposed, making it hard to say whether the FHFA is moving in a positive direction. “I think it’s too early to tell,” Tooley says.
“It depends on what side of it you are,” Perry says. For those who are focused primarily on housing affordability and access, recent FHFA policy changes may not be welcome. However, for those looking at it from a business perspective, the FHFA is “being run well,” according to Perry.
Chaffee thinks it will be years before we know for sure. Only after some time has passed will we be able to tell if and how policy changes impacted the mortgage market and homeownership rates.
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You’ve Probably Never Heard of the FHFA. Here’s How It’s Shaping Your Mortgage originally appeared on usnews.com
