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Financial Services Law Insights and Observations

GSEs must seek FHFA preapproval for new products

Agency Rule-Making & Guidance Federal Issues FHFA GSEs Fannie Mae Freddie Mac Federal Register

Agency Rule-Making & Guidance

On December 20, FHFA announced a final rule requiring Fannie Mae and Freddie Mac to provide advance notice of new activities and to obtain prior approval before launching new products. (See also fact sheet here.) Among other things, the final rule establishes that FHFA will determine which new activities merit public notice and comment and would be treated as new products subject to prior approval. Specifically, the final rule establishes that once a Notice of New Activity is deemed received, FHFA has 15 calendar days to determine if the new activity is a new product that merits public notice and comment. Additionally, the final rule establishes a public disclosure requirement for FHFA to publish its determinations on new activity and new product submissions. Among other things, if the agency “determines that a new activity is a new product, the final rule requires FHFA to publish a public notice soliciting comments on the new product for a 30-day period.” The final rule is effective 60 days after publication in the Federal Register.