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Fannie Mae and Freddie Mac’s regulator told congressional Democrats yesterday that he welcomes their input on coming up with a plan to free the mortgage giants from federal control, Bloomberg News reported. “As we begin the journey of evaluating the enterprises and developing a framework for ending conservatorship, I would welcome your insight and perspective," Joseph Otting, the acting director of the Federal Housing Finance Agency, wrote in a letter to House Financial Services Committee Chairwoman Maxine Waters and Senator Sherrod Brown, the top Democrat on the Senate Banking Committee. Waters and Brown are among lawmakers who raised concerns that the Trump administration was considering going it alone to pursue sweeping changes to housing-finance policy. Last week, the Democrats demanded answers from Otting after he said at a private meeting earlier this month that the Treasury Department and White House would soon release a proposal, and that Trump-appointed officials were willing to circumvent Congress to get something done.

One of the principal gatekeepers to housing-finance markets is stepping up scrutiny of nonbank mortgage lenders, concerned that some may not have the financial heft needed to overcome stressed conditions, the Wall Street Journal reported. The increased oversight by the Government National Mortgage Association, or Ginnie Mae, comes as nonbank lenders play an ever-bigger role in making mortgages to Americans and as housing markets are cooling. Many of these companies flourished after the financial crisis as banks stepped back from the mortgage market but haven’t yet been tested by an economic downturn. For the first time in recent memory, the agency has asked a handful of these lenders to improve certain financial metrics before granting them full ability to continue issuing Ginnie-backed mortgage bonds, according to Maren Kasper, who stepped in as Ginnie’s acting head this month. In the meantime, it has been granting approvals with shorter time frames to the lenders. Kasper declined to name the firms involved but said they are both large and small. Ginnie has also undertaken its first stress tests of business partners. The exams look at how lenders’ and servicers’ monthly cash-flow obligations would hold up if they reduced loan production and margins while increasing delinquencies. The results are expected shortly.

The White House will announce a plan by next month to end government control of Fannie Mae and Freddie Mac in a bid to resolve a long debate over the fate of the two companies that dominate the mortgage market, a top regulator said, Politico reported. Joseph Otting, acting director of the Federal Housing Finance Agency, told employees last week that the administration would not wait on Congress, where attempts to overhaul the housing finance system have repeatedly faltered in the years since Fannie and Freddie were rescued during the financial crisis. “In the next two to four weeks you’re going to be able to see some communication that comes out of the White House and Treasury that really sets a direction for what the future of housing will be in the U.S. and what the FHFA’s part of that will be,” Otting said at a Jan. 17 staff meeting.

Across rural America, the government shutdown has eliminated one of the best options for low- to middle-income homebuyers, a zero down payment mortgage from the U.S. Department of Agriculture, Bloomberg News reported. That’s leaving deals and would-be buyers’ lives in limbo. They’re begging sellers for extensions and struggling to decide when to mention their plans to landlords, said Shane Siniard, a loan officer with SWBC Mortgage Corp. in the Atlanta area, where the biggest share of the USDA loans are made, according to an analysis by Zillow. Siniard, one of the most prolific originators of the loans, has one client with a buyer who is unable to sell because he’ll need a payoff statement from the government.