Given that the conservator of Fannie Mae and Freddie Mac, the Federal Housing Finance Agency (FHFA) has been wielding incredible power of late in deciding how much the two mortgage giants can and cannot charge in guarantee fees and whom they can and cannot refinance, it was particularly disturbing to learn the that same FHFA has been deemed, dare I say it, incompetent, at least in one of its oversight capacities.
The FHFA's Office of Inspector General has released a scathing report that points to understaffing and inefficiency at the mortgage giants' regulator.
"FHFA-OIG has identified shortfalls in the Agency's examination coverage, particularly in the areas of Real Estate Owned (REO) and default-related legal services," the report begins. Translation: "Robo-signing" paperwork issues.