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- The American housing financing regulator wants Fannie Mae and Freddie Mac to write plans that treat the crypto as part of a borrower’s assets for mortgage exam.
- Crypto Holdings can be counted directly in the mortgage subscription if the proposals are approved.
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The Federal Housing Finance Agency (FHFA) in the United States has ordered the mortgage giants Fannie MAE and Freddie Mac to develop and submit proposals that would allow cryptographic assets to be included in mortgage subscription without compulsory USD conversion.
The directive, signed on June 25 by William Pulte, director of FHFA, came shortly after Pulte said on Monday that the accommodation regulator on housing would explore the possibility of including Crypto as part of the asset assessment in mortgage qualifications.
Strategy Executive President Michael Saylor proposed to share the company’s BTC credit model, which was created to assess solvency based on Bitcoin assets, which addresses the duration of the loan, guarantees, Bitcoin prices fluctuations and risk projections, with Pulte.
In response, Pulte said he would examine the strategy model.
Under the new ordinance, companies sponsored by the government must consider only cryptographic assets which can be verified and maintained on centralized exchanges regulated in the United States operating in appropriate legal frameworks.
The order also requires that the two companies incorporate risk mitigation measures, including market volatility adjustments and appropriate changes based on risks to the part of reserves held in cryptographic assets.
Any proposed modification must receive the approval of the board of directors of each company before submission to the FHFA for examination. The directive takes effect immediately and calls for implementation “as soon as reasonably practical”.
Cryptographic assets are generally not accepted as mortgage reservations, unless they are converted into US dollars. In the directives in 2021, Freddie Mac explicitly declared that the crypto may not be included in the calculation of assets as a basis for mortgage reimbursement and must be exchanged for US dollars for mortgage transactions.
Likewise, lenders are generally required to convert cryptographic assets into cash or cash before counting them in the form of reserves, due to volatility and regulatory uncertainty.
If it is approved, the move could help integrate cryptographic assets more fully in traditional mortgage funding, which makes borrowing more accessible from cryptography holders.
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