Fannie Mae and Freddie Mac have reached an agreement with banks better defining bad practices that would trigger penalties for lenders, expanding efforts to ease tight credit that’s creating a drag on the housing market.
The U.S.-backed companies will spell out when they will force lenders to buy back loans that were issued based on false or inaccurate information, Federal Housing Finance Agency Director Melvin L. Watt said Monday in a speech at the annual Mortgage Bankers Association conference in Las Vegas.
