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FHFA PACE Rulemaking Strategy August 6, 2012. Agenda Overview of FHFA proposed rule Coalition Response Strategy: – Outline of potential coalition response.

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Presentation on theme: "FHFA PACE Rulemaking Strategy August 6, 2012. Agenda Overview of FHFA proposed rule Coalition Response Strategy: – Outline of potential coalition response."— Presentation transcript:

1 FHFA PACE Rulemaking Strategy August 6, 2012

2 Agenda Overview of FHFA proposed rule Coalition Response Strategy: – Outline of potential coalition response comments – Grassroots strategy – DOE/White House engagement – Media strategy

3 FHFA Proposed Rule Fannie Mae, Freddie Mac shall: Take actions necessary to preserve their right to make mortgages subject to PACE liens immediately due (including amending the Uniform Security Instruments). Not purchase any mortgage subject to a first- lien PACE obligation. Not consent to the imposition of a first-lien PACE obligation on any mortgage.

4 FHFA’s Alternative # 1: Guarantee/Insurance Fannie Mae, Freddie Mac shall: Take actions necessary to preserve their right to make mortgages subject to PACE liens immediately due. Not purchase any mortgage subject to a first-lien PACE obligation or consent to a first-lien PACE obligation, except if: – PACE lien is recorded; and Repayment in the event of foreclosure or similar default is irrevocably guaranteed by a qualified insurer; or Qualified insurer insures Fannie and Freddie against 100% of any net loss attributable to the PACE obligation in the event of foreclosure or similar default; or PACE program provides sufficient reserve fund for mortgage holders which would cover 100% of any net loss attributable to the PACE obligation in the event of foreclosure or similar default.

5 FHFA’s Alternative # 2: FHFA’s Underwriting Standards Fannie Mae, Freddie Mac shall: Take actions necessary to preserve their right to make mortgages subject to PACE liens immediately due. Not purchase any mortgage subject to a first-lien PACE obligation or consent to a first-lien PACE obligation, except if: – PACE obligation ≤ $25,000 or 10% of fair market value, whichever is lower; – Loan-to-Value Ratio ≤ 65%; – Debt-to-Income Ratio ≤ 35%; – FICO ≥ 720; and – PACE lien is recorded.

6 FHFA’s Alternative # 3: H.R. 2599 Underwriting Standards Fannie Mae, Freddie Mac shall: Take actions necessary to preserve their right to make mortgages subject to PACE liens immediately due. Not purchase any mortgage subject to a first-lien PACE obligation or consent to a first-lien PACE obligation, except if: – PACE lien is recorded; and – H.R. 2599 underwriting standards are satisfied.

7 PACE Proponents Proposed Response fundamentally disagree with FHFA’s position that PACE poses significant safety and soundness concerns; challenge the legal right of the FHFA to determine how and under what circumstances state and local governments can make valid special assessments that meet public purposes; Recommend adopting a REVISED Rule permitting Fannie & Freddie to purchase and consent to mortgages with PACE liens if an appropriately constructed Alternative # 1 (insurance/loan loss reserve) or Alternative # 3 (H.R. 2599 standards) are satisfied; and, Provide additional evidence on the record supporting PACE and alternatives # 1 and # 3.

8 Next Steps on Joint Comment Letter Email Ramona Willis (rwillis@wsgr.com) if your organization is tentatively interested in signing on to joint proponents comments by August 15 th.rwillis@wsgr.com If you are interested in contributing to the substance of the comments, gathering additional research and facts for the record, please contact Sheridan Pauker (spauker@wsgr.com) as soon as possible.spauker@wsgr.com Deadline for submitting comments: September 13 th

9 – Coalition Coordination Weekly calls until comments are due? – Grassroots strategy Action alerts (timing, and goal) Letter template (volunteers to draft this?) – DOE/White House/Congress engagement Assignments for calls/visits – Media strategy Media talking points Joint press release Op-eds

10 Thank you for participating. Contact: Annie Lappé annie@votesolar.org annie@votesolar.org


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