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Fannie Mae and Freddie Mac are pulling back on some mortgages meant to make homeownership more affordable, their latest effort to rein in risk at the behest of their regulator, the Wall Street Journal reported. The two companies are cutting back on the proportion of loans they back to borrowers with small down payments, for example, and mortgages to deeply indebted borrowers. The regulator, the Federal Housing Finance Agency, says it wants Fannie and Freddie to be prepared for a possible economic downturn. Tamping down risk could limit their defaults and produce bigger profits, which in turn could help them appeal to potential investors. The FHFA has made it a priority to get Fannie and Freddie out from under government control, but doing so will likely require the firms to raise billions of dollars from investors. Critics say the changes could run counter to Fannie’s and Freddie’s mission of making homeownership more accessible and affordable.

A reverse mortgage bill aiming to change the way industry professionals do business in the state of New York was signed into law on Friday by Governor Andrew Cuomo, Reverse Mortgage Daily reported. This has codified the bill into New York state law, and Governor Cuomo’s office confirmed to RMD that he had signed it. Assembly Bill 5626 was first passed by the New York State Assembly in May, and takes sweeping aim at what it calls “deceptive practices,” requiring reverse mortgage lenders to provide supplemental consumer protection materials while imposing additional restrictions on lenders related to their payment of insurance premiums and property taxes. The bill also requires that both lenders and borrowers be represented by an attorney at the time of closing, and at least one attorney must be present to conduct the closing itself. Sponsored in the New York State Assembly by Helene E. Weinstein, who represents Assembly District 41 in Brooklyn, the intent of the new law was detailed in a memo circulated to New York state lawmakers as answering the necessity of regulating a complex product that is sold to a protected class with current regulations that are described by the memo as “inadequate.”

Thanks to increases in home prices in 2019, the Federal Housing Administration loan limit will increase for nearly all of the country in 2020, HousingWire.com reported. According to an announcement from the FHA, the 2020 FHA loan limit for most of the country will be $331,760, an increase of nearly $17,000 over 2019’s loan limit of $314,827. That loan limit applies to much of the country, with the figure determined as a percentage of the national conforming loan limit for Fannie Mae and Freddie Mac, which is increasing in 2020 to $510,400. FHA is required by the National Housing Act, as amended by the Housing and Economic Recovery Act of 2008, to set single-family forward loan limits at 115 percent of median house prices, subject to a floor and a ceiling on the limits. FHA calculates forward mortgage limits by Metropolitan Statistical Area and county. FHA’s 2020 minimum national loan limit, or “floor,” of $331,760 is 65 percent of the national conforming loan limit of $510,400. This floor applies to “low-cost areas,” which are counties where 115 percent of the median home price is less than the floor limit.

The Federal Housing Finance Agency announced yesterday that it is raising the conforming loan limits for Fannie Mae and Freddie Mac to more than $510,000, HousingWire.com reported. In most of the U.S., the 2020 maximum conforming loan limit will be raised to $510,400, up from 2019’s level to $484,350. This marks the fourth straight year that the FHFA has increased the conforming loan limits after not increasing them for an entire decade from 2006 to 2016. In 2016, the FHFA increased the Fannie and Freddie conforming loan limit for the first time in 10 years, and since then, the loan limit has gone up by $93,400. Back in 2016, the FHFA increased the conforming loan limits from $417,000 to $424,100. Then, the next year, the FHFA raised the loan limits from $424,100 to $453,100 for 2018. And in 2018, the FHFA increased the loan limit from $453,100 to $484,350 for 2019.