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FHFA; Fannie/Freddie new terms; Zillow WFH double-down 🤔

By July 1, 2021 No Comments

FHFA Inspector General quits after report claims she bullied her staff relentlessly

The inspector general overseeing the Federal Housing Finance Agency resigned Tuesday, two months after a scathing watchdog report alleged that she abused her authority, retaliated against employees and blocked an investigation into her conduct.

The move comes at a time of changing leadership at the FHFA, as well.

In a letter to staff on Tuesday, Laura Wertheimer, the inspector general overseeing FHFA, who was nominated by President Barack Obama in 2014, wrote that: “President Biden should have the opportunity to fill both the FHFA Director and IG positions with his own nominees” and that she “had no intention of staying for seven years.” (WaPo paywall.)

Wertheimer will leave her post at the end of July.

In April, an investigation by a special panel — known as the Integrity Committee — sent a report to the White House which found that Wertheimer “showed a disdain and resistance” toward oversight from Congress and the Integrity Committee and that she fostered “a culture of witness intimidation through a pattern of staff abuse and fear of retaliation.” 

The report included complaints of a toxic work environment in which Wertheimer called people by “demeaning nicknames,” including “Boris and Natasha,” the spy villains in the “Rocky and Bullwinkle” cartoon series. 

Wertheimer also used the term “weasel” to disparage staff and reinforced the message by buying and distributing a children’s book titled “Weasels” around the office. 

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Fannie/Freddie authorized to expand refi terms

Who/What is a borrower with a “permanent COVID-19 hardship?” Someone who lost a family member or a job to the pandemic? Someone who can’t continue making mortgage payments because their worldchanged so much? The definition is nebulous, at best, and leads servicers into the realm of opacity. But, nonetheless, we need to figure this out. 

Not one week into the job, the new acting director of the FHFA is already switching things up.

“Allowing more families to qualify for an interest rate reduction will prevent unnecessary foreclosures, help strengthen the Enterprises' books of business, and make sustainable homeownership a reality for more families currently living with the uncertainty of forbearance,” said Acting Director Sandra L. Thompson.

The FHFA  announced changes to loan modification terms for COVID-19 impacted borrowers with mortgages backed by Fannie Mae or Freddie Mac (the Enterprises) needing payment reduction for successful home retention. The updated terms are specifically for borrowers with “permanent COVID-19 hardships.”

​Flex Modification terms will be adjusted for COVID-19 hardships making interest rate reduction possible for eligible borrowers, regardless of the borrower's loan-to-value ratio. Previously, only borrowers with mark-to-market loan-to-value (MTMLTV) ratios greater than or equal to 80 percent were eligible for a possible interest rate reduction. 

Keep calm, carry on.

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Zillow exec doubles down on WFH, slams “office culture”

Pandemic burnout is real, and some companies are completely rethinking the modern workspace in its wake. For example, Bumble said it was closing all its offices last week to help staff deal with burnout.

A spokesperson for the female-led dating app confirmed the weeklong break to Sky News after Clare O'Connor, the company's head of editorial content, said in a now-deleted tweet that the company's staff, around 700 employees, were getting a paid week off.

Such dedication to employee work/life balance is a new concept. Very new.

When Yahoo banned working from home a mere 6 years ago, the reason was one often cited in corporate America: Being in the office all the time is essential for spontaneous collaboration and innovation.

Yet people who study the issue say there is no evidence that working in person is essential for creativity and collaboration. It may even hurt innovation, they say, because the demand for doing office work at a prescribed time and place is a big reason the American workplace has been inhospitable for many people.

“That’s led to a lot of the outcomes we see in the modern office environment — long hours, burnout, the lack of representation — because that office culture is set up for the advantage of the few, not the many,” said Dan Spaulding, chief people officer at Zillow, the real estate marketplace. (NYTimes paywall.)

“The idea you can only be collaborative face-to-face is a bias,” he said. “And I’d ask, how much creativity and innovation have been driven out of the office because you weren’t in the insider group, you weren’t listened to, you didn’t go to the same places as the people in positions of power were gathering?”

At Zillow, nearly all employees will be remote or come in only once in a while. Several times a year, teams will go to small offices set up for gatherings.

“One of our big fears is that if we don’t get this right, we create this two-tier employee reality — who’s in the room, who’s not, who’s playing the politics, who’s not,” Mr. Spaulding at Zillow said. “We believe humans want to connect and collaborate. But do you need to do that five days a week, or can you do that once every three months?”

Spaulding didn’t stop there and, instead, doubled down by posting to his LinkedIn.

“Love being a part of this The New York Times article debunking some of the assumptions that the randomness of the office drove innovation. Maybe – but as we rethink work emerging from the pandemic we can experiment with collaboration in new ways,” he said. 

“The greatest era of work experimentation is upon us. At Zillow, we’ve found that innovation and collaboration stay strong, even while we expand our employee footprint to all 50 states, with most people working remote.”

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