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The Department of Housing and Urban Development (HUD) approved Tuesday an agreement to settle allegations that a bank led by Treasury Secretary Steven Mnuchin and a top Trump-appointed bank regulator violated federal lending discrimination laws, The Hill reported. HUD announced on Tuesday that it approved a settlement between CIT Bank and a California fair lending nonprofit over claims that the bank’s subdivision, OneWest Bank, discriminated against black and Latino customers in the Los Angeles area. The allegations, made in a 2017 complaint to HUD by the California Reinvestment Coalition, cover conduct that occurred while Mnuchin and Joseph Otting, who Trump appointed to lead the Office of the Comptroller of the Currency, led the bank. The California Reinvestment Coalition accused OneWest of refusing to offer mortgages, market banking services and operate branches in majority-minority neighborhoods in Los Angeles between 2014 and 2017. The practice, known as “redlining,” is illegal under federal law. CIT Bank did not admit to the allegations in the complaint, but agreed to offer $100 million in mortgages and home loans in majority-minority neighborhoods, invest $5 million in other loan subsidies, spend $1.3 million on advertising and community outreach and provide $1 million in grants for financial education counseling.

President Donald Trump’s administration faces a growing list of hurdles that could scuttle its ambitions to remove U.S. mortgage giants Fannie Mae and Freddie Mac from their government lifeline, Reuters reported. Fannie and Freddie have been in conservatorship since they were bailed out during the 2008 financial crisis. In March, the administration said it was devising a plan to put them back on their feet, raising market hopes that the pair might seek a jumbo initial public offering as early as next year. But as the Federal Housing Finance Agency (FHFA) and the U.S. Treasury begin to dig into the details, reality is starting to bite. From securing a federal guarantee to extricating the Treasury from its holdings, there is too much to do before the 2020 presidential election, analysts and housing experts said. The U.S. Treasury Department is already stretched by the trade war with China and sanctions issues, they noted. Mark Calabria, director of the FHFA which controls Fannie and Freddie, told Reuters last week he hoped the pair would be ready to exit conservatorship within five years, offering the clearest signal yet a speedy overhaul is unlikely.

The Trump administration’s hotly anticipated blueprint for overhauling mortgage guarantors Fannie Mae and Freddie Mac may not be published until September as the U.S. Treasury juggles several other pressing issues, the housing regulator told Reuters. Mark Calabria, director of the Federal Housing Finance Agency (FHFA), which oversees the government-sponsored enterprises, said in an interview it was his “hope” that they would have exited or be ready to exit conservatorship before his term ends in 2024. However, Calabria is not operating toward a hard deadline, he noted. “That’s my time horizon,” he said, referring to the end of his term. “I’m under no expectation to try to get all this done. ... So if in four years, nine months they’re not out of conservatorship, I’m not pushing them out.” Calabria’s comments will temper market expectations for a speedy overhaul of Fannie and Freddie before the 2020 presidential election.

The Trump administration is growing wary of taking bold steps toward freeing Fannie Mae and Freddie Mac from federal control before the 2020 election in part because of the political risk of potentially upending the U.S. mortgage market, Bloomberg News reported. While White House and Treasury Department officials are eager to end the companies’ decade long conservatorships, they see the task as arduous, slow-moving and extremely complicated, said the people, who asked not to be named in discussing internal deliberations. Adding to the challenge is that Treasury Secretary Steven Mnuchin is spending much of his time on more pressing priorities, including the trade war with China, debt ceiling negotiations with Congress and imposing sanctions on Iran and other nations. One concern among administration officials is that freeing Fannie and Freddie could impact the housing market, possibly making it harder for borrowers to get loans just as President Donald Trump is seeking another term.

The parent of residential mortgage lender Stearns Lending LLC has filed for bankruptcy after agreeing with majority owner Blackstone Group LP to a debt-restructuring plan that will erase more than $180 million in bond debt from its balance sheet, the Wall Street Journal reported. Stearns Holdings LLC, based in Santa Ana, Calif., filed for chapter 11 protection today in U.S. Bankruptcy Court in New York, listing assets and liabilities each in the range of $1 billion and $10 billion. Blackstone has agreed to pump $60 million in new money into the mortgage lender as part of the balance-sheet restructuring, which also includes commitments of $1.5 billion from warehouse lenders. Blackstone’s private-equity arm purchased a majority stake in Stearns in 2015. Stearns has about $184 million in outstanding bonds that mature next August and sold most of its mortgage-servicing rights last year to pay down a portion of its bond debt.