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Bill Pulte says there will be fewer surprises at Fannie Mae and Freddie Mac moving forward. The Federal Housing Finance Agency director posted to X Monday that the regulator doesn't foresee any more executive changes at the government-sponsored enterprises, other than "already agreed-upon departures." In swift action last month, Pulte reshuffled the boards of the GSEs, and fired Freddie Mac CEO Diana Reid. "Our focus will now turn to growth, making homes more affordable, rooting out mortgage fraud, & providing great career opportunity to those who make Fannie & Freddie great American Icons, again!" the director wrote in a social media post. Longtime Freddie Mac President Mike Hutchins is the GSE's interim CEO. It's unclear if Pulte plans to name him permanent CEO, and the FHFA didn't respond to an immediate request for comment Tuesday morning. Throughout the leadership changes, the director hasn't provided any clues regarding a potential GSE release from conservatorship, which investors have called for under President Trump's second term.Pulte has disclosed numerous FHFA updates via his X feed, although the regulator hasn't been transparent regarding those moves. The agency has purportedly reduced its workforce by 25% and terminated an unspecified number of Fannie Mae employees for alleged fraud, but the GSEs are still hiring for dozens of positions. Fraud has been a focus of Pulte in his first month as director. He debuted a mortgage fraud tip line last week that the director claimed Tuesday had been receiving "amazing tips." In another X post Tuesday, Pulte said there were massive amounts of fraud under former President Biden's administration. The regulator is also mulling a way to "recall" loans, although no further details were released.

Almost exactly a year after it was announced, Total Expert has launched its two-way integration with Dark Matter's Empower loan origination system.With the tie-in, leads, contract details, updates and more from the Total Expert customer engagement technology offering are automatically loaded into Empower.At the same time, customer information and data like loan status milestones as well as approval and closing dates, which reside on Empower, instantaneously update contact records in Total Expert."Lenders that connect Total Expert with the Empower LOS can deliver personalized customer journeys at scale like never before,' said Joe Welu, CEO of Total Expert in a press release. "This integration provides loan officers with high-quality data faster so they can deliver the right message to the right customers at the right time."The initial agreement between the two companies was announced on April 23, 2024. In the time following the announcement, and especially since last September, interest rate movements have been volatile, leading to refinance boomlets, with some looking for better new and current customer engagement tools.The pattern of quick rate drops followed by equally rapid movements higher is expected to last throughout the year, especially around the uncertainty regarding the U.S. economy.On the afternoon of April 21, Zillow's rate tracker had the 30-year fixed-rate mortgage at 6.99%, extremely close to the 7% level; some in the industry commented regarding the April 17 Freddie Mac Primary Mortgage Market Survey they were happy it stayed below that psychological benchmark."This two-way integration will help lenders move faster with exceptional insights to stay ahead of consumer expectations," said Sean Dugan, who recently became the CEO of Dark Matter Technologies following the retirement of Rich Gagliano, who is now executive chairman. "We prioritized Total Expert's leading platform because we believe this will be a powerful partnership that provides for our clients."

Enjoy complimentary access to top ideas and insights — selected by our editors. The last few months at the Federal Housing Finance Agency and by extension Fannie Mae and Freddie Mac, have been an immense period of change and upheaval under the guidance of Bill Pulte. At the heart of the fray, lenders are wondering what the policy plays will mean for their day-to-day lives.Pulte, who officially took office in March, expressed support for President Donald Trump's approach to eliminating "waste, fraud and abuse" across the federal government during his confirmation hearing the previous month and touted a similar approach if he were appointed to lead the FHFA."Are we using the money as wisely as we can?" Pulte said during the hearing. "I think now having a housing and mortgage person in charge of it, we look forward to, if confirmed, going in and seeing where that money is being spent, and making sure that as many homes are being built as possible through these funds."Time has proven that deregulation and cost cutting have indeed been the approach adopted by Pulte, who has unwound special purpose credit program offerings at Fannie Mae and Freddie Mac, shuttered Fannie's "Repair All" strategy for real-estate owned properties, overhauled the boards of both government-sponsored enterprises and more.This month, new updates out of the FHFA include the firing of more than 100 employees for allegedly allowing fraudulent behavior and other unethical conduct to occur, the debut of a mortgage fraud tip line and promises to crack down on fraud through the agency's Suspended Counterparty Program."In President Trump's housing market, there is no room for fraud, mortgage fraud, or any other deceitful act that can jeopardize the safety and soundness of the housing industry," Pulte said in a press release.Read more: Senate Republicans urge Pulte to take more actionsLenders are also keeping a close eye on the possibility of the GSEs being released from conservatorship among other policy moves, with expectations for the change to be made sometime in the near but not immediate future.Experts with the CRE Financial Council told National Mortgage News that the release would create the need for a vital balancing act between the provision of liquidity and affordability in the housing markets and the fueling of market development, which is easier said than done."Even under conservatorship, or even not under conservatorship, it is kind of closely tied to the government, and you don't necessarily want to crowd out private capital there too," David McCarthy, CREFC's managing director and chief lobbyist and head of legislative affairs, said.Read more: FHFA's Bill Pulte shakes up agency with social media pushBelow are insights and explanations on the recent FHFA regulatory changes and what they mean for the mortgage industry at large. Al Drago/Bloomberg Pulte starts dismantling DEI at FHFA, GSE cost-cutting could be nextBill Pulte, the newly appointed director of the FHFA, has wasted little time pulling back on the agency's diversity, equity and inclusion initiatives — programs he has touted as nonsense."Consulting contracts that waste money and other DEI nonsense [are] being stripped away," Pulte wrote in a post to X on April 7. "Now, Fannie Mae and Freddie Mac can finally work on things that make housing more affordable for Americans!"Pulte announced his decisions to end the FHFA's Diversity and Inclusion Examination Rating System as well as diversity and data collection requirements for Federal Home Loan Banks and their Office of Finance boards of directors respectively via his account on X on April 4.Read more: Pulte targets DEI at FHFA, hints at GSE cost-cutting Andrew Harrer/Bloomberg FHFA rearranges Freddie Mac board of directors, assigns audit roleGrace Huebscher, a former executive at Capital One Multifamily Finance who has been on Freddie Mac's board of directors since November 2017, resigned from her role effective March 24.Details from the GSE's Securities and Exchange 8K filings on March 28 stated that Huebscher chaired Freddie Mac's Risk Committee and was also a member of its Compensation and Human Capital, Executive and Operations and Technology committees. Following her departure, the FHFA named Michael Parrott, founder and chief executive of 480th Consulting, to the entity's board as a non-executive director and Huebscher's successor effective March 28. Christopher Herbert, who was most recently chair of Freddie Mac's Mission and Housing Sustainability Committee, also resigned from the board of directors effective March 19. He was succeeded by David Farbman, who is also CEO of the Michigan-based healthcare technology provider Healthrise.Read more: FHFA replaces Freddie Mac board member, assigns audit role Ting Shen/Bloomberg Would the FHFA actually be able to lower the conforming loan limit?Despite FHFA Director Bill Pulte's adamant statements that the agency has "no plans to do anything" when it comes to the conforming loan limit, industry experts aren't convinced that lowering the threshold is entirely off the table.The measure has been brought up before as part of a broader move to unwind the conservatorship of government-sponsored enterprises like Fannie Mae and Freddie Mac, but there are lingering doubts as to whether or not the FHFA has the ability to lower the CLL."From a populist political standpoint it would make sense their footprint would be smaller, not bigger," Eric Hagen, managing director at BTIG, told National Mortgage News. "The easiest way for the GSEs to do that, the bluntest way for them to effect that change would be to lower the CLL."Read more: Is the FHFA planning to lower the conforming loan limit? Al Drago/Bloomberg SPCPs are out at Fannie Mae, Freddie Mac. What does it mean?Following new marching orders from FHFA Director Bill Pulte, Fannie Mae and Freddie Mac are prohibited from getting involved in special purpose credit programs.In a March 25 post on X, wherein he shared the memo saying "the current level of support for SPCPs is inappropriate for regulated entities in conservatorship," Pulte ordered that both GSEs must dismantle any SPCPs supported by Fannie and Freddie. Data from the FHFA's 2023 Housing Mission report showed that Fannie Mae was able to pick up 921 loans with more than $5 million in down payment or closing cost assistance offered to borrowers through its SPCP program known as HomeReady First. Freddie Mac acquired 2,472 loans with roughly $4 million in down payment or closing cost assistance through its program, BorrowSmart Access.Read more: What FHFA's ban on SPCPs mean for lenders, borrowers Andrew Harrer/Bloomberg The impact of FHFA Pulte's UDAP advisory pullback on lendersLike DEI and SPCP efforts, FHFA Director Bill Pulte is rolling back direct oversight of unfair and deceptive acts and practices, while also removing renter requirements for multifamily mortgages.The policy plays to remove the UDAP oversight and renter requirements were a welcomed addition to the market for lenders, many of whom viewed the rental framework, which was originally delayed to May 31, as beyond the purview of the FHFA. "In order to reduce potential conflict or confusion over interpretation of UDAP provisions, U.S. Federal Housing FHFA has determined that the UDAP Advisory Bulletin should be rescinded and not applied to its regulated entities," Pulte said in a March 24 memo. Read more: FHFA's UDAP advisory rollback: What it means for lenders

The top five banks in the list had a combined second-lien loan volume of more than $95 billion at the end of the fourth quarter of 2024. Most lenders in the ranking saw an increase between Q3 2024 and Q4 2024, with Discover seeing the largest increase at 5.95%.The data in this ranking came from National Mortgage News' MortgageStats site, which pulls information from quarterly call reports available from the Federal Financial Institutions Examination Council.Scroll through to see which lenders were in the top 20 through the end of December 2024.Banks with the largest second-lien loan volume in Q4 2024 Rank Company Q4 dollarvolume Q3 dollarvolume  Percent change 20 First National Bankof Pennsylvania $2,033,000,0000 $1,988,000,0000 2.26% 19 Umpqua Bank $2,123,000,0000 $2,101,000,0000 1.05% 18 First Horizon Bank $2,229,000,0000 $2,214,000,0000 0.68% 17 First Citizens Bank $3,002,000,0000 $2,861,000,0000 4.93% 16 KeyBank $3,679,000,0000 $3,778,000,0000 -2.62% 15 Regions Bank $3,708,000,0000 $3,661,000,0000 1.28% 14 Zions Bank $3,781,000,0000 $3,679,000,0000 2.77% 13 Fifth Third Bank $4,072,000,0000 $3,956,000,0000 2.93% 12 BMO $4,816,000,0000 $4,711,000,0000 2.23% 11 Citibank $5,537,000,0000 $5,821,000,0000 -4.88% 10 Discover $6,406,000,0000 $6,046,000,0000 5.95% 9 TD Bank $7,817,000,0000 $7,618,000,0000 2.61% 8 Huntington NationalBank $8,113,000,0000 $8,032,000,0000 1.01% 7 Truist $9,965,000,0000 $10,014,000,0000 -0.49% 6 Wells Fargo $13,193,000,0000 $13,754,000,0000 -4.08% 5 U.S. Bank $13,565,000,0000 $13,364,000,0000 1.50% 4 Citizens Bank $16,371,000,0000 $15,862,000,0000 3.21% 3 JPMorgan Chase $17,329,000,0000 $17,083,000,0000 1.44% 2 PNC Bank $21,953,000,0000 $21,764,000,0000 0.87% 1 Bank of America $26,576,000,0000 $26,277,000,0000 1.14%

Recent purchases by Dream Finders Homes bring the company deeper into the title and mortgage lending universes.Dream Finders has closed on its purchase of Alliant National Title; terms of the deal were not disclosed. Dream Finders previously owned an agency, Golden Dog Title and Trust.The title company deal was announced in October and follows last month's purchase of the remainder of Cherry Creek Mortgage. In July 2024, Dream Finder acquired the outstanding interest in Jet Home Loans. It has also acquired a number of other homebuilders since its founding in 2008.Why Dream Finders wants to grow its reachThis business expansion also comes at a time when homebuilders are worried about higher supply costs as a result of President Trump's far ranging imposition of tariffs.Meanwhile, other firms involved in real estate sales and finance such as Rocket have been expanding their verticals. Rocket recently inked transactions with Redfin and Mr. Cooper.Alliant National works with more than 700 agents in 32 states and the District of Columbia."We are pleased to close on this transaction and formally welcome David Sinclair and the Alliant National team to our Dream Finders Homes family," said Patrick Zalupski, chairman and CEO of the homebuilder in a press release. "This partnership creates significant value for both Alliant National and Dream Finders as a result of further vertical integration and additional service offerings to our stakeholders."Title insurance is dominated by four companiesThe title insurance underwriting business is dominated by four companies: Fidelity (which owns the second, fourth and seventh largest underwriters by premium volume), First American, Stewart and Old Republic. The largest underwriting units of those companies hold a combined 79.7% market share, according to 2024 data from the American Land Title Association.In comparison, Westcor, the sixth largest underwriter in the business, has a 3.8% market share. The tenth largest was Doma at 1.8%. Alliant was outside of the top 10, at 17th, with a 0.73% share; it produced $118.6 million in title premiums, the ALTA data reported.While many homebuilders have title agencies, Lennar is among the few other firms with an interest in an underwriter. It currently holds a stake in Title Resources Group, which it obtained through a series of transactions, starting with its former subsidiary North American Title. It sold that business to States Title, which rebranded as Doma and became public, with Lennar as its largest shareholder.Lennar ended up with over 8% of TRG as a result of its purchase of Doma. Together, TRG and Doma had a 4.63% market share.Besides Lennar and Dream Finder, other homebuilders which own underwriters are Pulte, Premier Land Title; DH Horton, DHI Title Insurance; and Shaddock National Holdings, First National Title Co.On the lender side, a subsidiary of Finance of America, Incenter, had owned underwriter Agents National Title and agency Boston National Title, but sold them to mortgage insurer Essent Group in 2023 for $100 million.

Neighborworks America is defending its work supporting affordable housing efforts amid reports the Trump administration's cost-cutting task force is eying the organization.The Department of Government Efficiency met with Neighborworks last week and asked that one of its operatives be embedded in the nonprofit, according to a report from Politico. The National Housing Conference last week also warned of DOGE targeting the congressionally chartered nonprofit, which supports a network of around 250 local housing organizations. HousingWire first reported the NHC's bulletin. The coalition could not specify DOGE's goals nor timeline at Neighborworks. In a statement Monday, Neighborworks said itself and its network of local nonprofits have been "prudent and efficient stewards of federal dollars." In fiscal year 2024, the Neighborworks network attracted $71 of public and private capital for affordable housing work for every $1 of federal investment. "NeighborWorks America is aligned with the administration's housing goals," the statement read. "Like the administration, we believe in the efficient delivery of financial resources and technical expertise that sustains and builds affordable housing supply."The statement didn't mention DOGE, and a spokesperson Monday did not respond to follow-up questions. In a separate press release last week, Neighborworks said it was aligned with President Trump's executive order to lower the cost of housing and expand supply. While the administration has pledged to address extreme unaffordability in the housing market, it's also made cuts to federal housing operations at the Department of Housing and Urban Development and the Department of Veterans Affairs. HUD is allegedly mulling layoffs to staff including fair housing enforcement workers.President Trump's back-and-forth decrees on international tariffs have also contributed to rising mortgage rates in recent weeks.What does Neighborworks do?The decades-old Neighborworks nonprofit provides grants, training and technical assistance to its local organizations nationwide, including a downpayment assistance program. Among other figures, Neighborworks says it helped 12,269 new homeowners last year and provided funds including lending for 12,844 homeowners to rehabilitate their properties. The organization via its network owns or manages 211,856 rental homes, and claims to have created or maintained 48,885 full-time jobs. Congress appropriated $158 million to Neighborworks in fiscal year 2024, which according to lawmakers was a $12 million decrease from the prior year. Although it receives federal funds, Neighborworks is not a federal agency, and its workers are not federal employees. Its board of directors does include financial regulators and currently lists Grovetta Gardineer, an official with the Office of the Comptroller of the Currency; and Travis Hill, the acting chairman of the Federal Deposit Insurance Corp. A Republican-led House of Representatives in 2011 previously mulled cutting all federal funding for Neighborworks, then suggesting its work was duplicative of HUD operations. HUD downsizing its office spaceTrump's housing regulators have made changes in line with the administration's broader effort to rid the government of excessive fraud, waste, and abuse, including downsizing physical offices. HUD and the General Services Administration last week said the department's headquarters since 1968, the Robert C. Weaver Federal Building in Washington, D.C., was added to the GSA's "accelerated disposition list."The building costs taxpayers $56 million annually in rent and expenditures, and faces over $500 million in deferred maintenance and modernization costs, the government said. HUD staff also occupy just half of the building. Turner in an interview with Fox News last month said he was displeased with attitudes that HUD's Brutalist building was "the ugliest building in D.C."DOGE has claimed it saved taxpayers $5.6 million by ending leases for over a dozen Rural Housing Service and HUD offices nationwide.

Castlelake LP has agreed to purchase a maximum of $2 billion in new non-agency mortgages from Invictus Capital Partners through a partnership in which other terms were not disclosed.The buyer is making a capital commitment aimed at helping Invictus scale its Verus correspondent-investor loan platform, which has laid claims to being the main issuer of non-qualified mortgage securitizations since 2017.The partnership between alternative investment managers adds to signs that investors see private mortgages as attractive, albeit not immune to risk given policy-driven volatility in broader markets. While the Trump administration is dedicated to scaling back the public sector and possibly privatizing key  secondary market players, it also has been doing things like adding tariffs that affect pricing and availability of certain homebuilding materials, with exemptions for some."This relationship with Castlelake highlights the recognition from sophisticated alternative investment managers of the significant opportunity to invest in high-quality loans in the residential credit market," said Michael Warden, CEO and senior managing director at Invictus, in a press release.Isaiah Toback, a partner at Castlelake, said in the release that Invictus' loan sourcing and credit underwriting approach is in alignment with his company's "granular data-driven in investment philosophy and focus on downside protection."We look forward to working with the Invictus team as they continue the scaling of their loan investment capabilities and provide our investors with exposure to what we view as attractive pricing in the private residential loan market," added Toback, who also is Castlelake's deputy co-chief investment officer.Castlelake has partnered with other entities to finance or buy around $7 billion of residential and commercial real-estate loans in total since last year. CEO Evan Carruthers and Executive Chairman Rory O'Neill founded Castlelake in 2005 and it manages around $25 billion in funds for a diverse global client base. Castlelake employs 220 people in North America, Asia and Europe.Near the end of 2024, Verus Mortgage reported that it had completed a total of 65 rated securitizations. Verus specializes in non-QM and investor rental loans, for which borrowers pay up in ways that can be attractive to investors. Its products range from first liens to home equity lines of credit, one of the latest non-agency products originators have been seeking showing more interest in as investor demand has grown.Invictus has purchased more than 70,000 loans with a balance of over $35 billion in total since 2015 and CEO Michael Warden, who previously served as the head of fixed income at Friedman, Billings, Ramsey & Co., founded it in 2008. Employees own a majority equity stake in the company. Invictus and its affiliates employ around 200 professionals, including some with experience in residential debt that includes work in higher-yielding, distressed investments.With broader capital markets increasingly volatile due to uncertain investor reactions to unprecedented steps the Trump administration has taken, including attempts to intervene in monetary policy decisions traditionally made independently, there's widespread anticipation of heightened need to manage distress. Types of distress that could materialize include an economic slowdown, according to a recent M&T Bank forecast. M&T does not anticipate a full-blown recession.Back in March, a broader group of business economists showed some concern about a recession but a greater fear about inflation potentially remaining heightened for over a year. Monetary policymakers have not wanted to lower interest rates until a key inflation measure reaches a 2% target.

The month of March saw a renewed interest in newly constructed properties, as rates slightly loosened and the spring homebuying season kicked off. New-home purchases grew 14% from the month prior, the Mortgage Bankers Association Builder Application Survey data reveals. This is up from the 0.4% growth seen in February and a 5.5% increase from a year ago.By loan type, conventional loans accounted for 49% of applications, while FHA and VA loans made up 37% and 13%, respectively."Applications for new home purchases increased in March, consistent with typical seasonal patterns and supported by mortgage rates that had been drifting lower," said Joel Kan, MBA vice president and deputy chief economist, in a press release.  The seasonally adjusted pace of new-home sales slightly dipped in March. As a result, sales amounted to 629,000 units, a 0.8% dip from 634,000 units a month prior."The growing inventory of newly built, move-in ready homes supported homebuyer interest over the month, pushing the index higher than last year's levels. Our estimate of seasonally adjusted new-home sales saw a slight decline in March but were stronger than last year's pace of sales," added Kan.Unadjusted sales amounted to 61,000 homes, a 7% increase from 57,000 properties purchased in February, the trade group's estimates said.Despite a spike in new-home purchase applications, it is too early to tell whether this trend will continue.The average loan size for new homes decreased from $397,516 in February to $381,921 in March, per the survey.Though that may soon change as a result of on-again, off-again tariffs, which may jack up material costs for homebuilders that ultimately get passed along to buyers. As economic uncertainty remains due to inflation concerns, uncertainty around tariffs and shifting expectations about future Federal Reserve policy, interest rates have quickly rebounded, hovering close to 7%.

Bloomberg News The Federal Deposit Insurance Corp. plans to eliminate roughly 1,250 positions across most departments, according to an internal email sent to staff around noon Monday and obtained by American Banker. The cuts come as part of the second phase of the regulatory agency's plan to reduce staff, which was submitted in April to the Office of Personnel Management and the Office of Management and Budget. The plan aligns with the Trump administration's broader workforce streamlining effort, known as the Workforce Optimization Initiative that the new Department of Government Efficiency is leading."The FDIC plans to reduce staffing by approximately 1,250 positions across most divisions and offices," the email told employees. "Some of these abolished positions include those eliminated through OPM's deferred resignation program that closed in February and the discontinuation of some non-permanent positions. Of the remaining positions, some are currently vacant but many are occupied by staff and managers."To reduce its workforce, the FDIC said it will pursue two main strategies: offering targeted voluntary separation incentives to staff and, if needed, initiating formal reduction in force procedures to eliminate positions that remain occupied after other attrition efforts.The agency plans to offer three types of incentives: Voluntary Early Retirement Authority, or VERA; the Voluntary Separation Incentive Program, or VSIP; and the Deferred Resignation Program, or DRP. VERA and VSIP will be made available to employees in roles specifically targeted for reduction, while DRP will be offered more broadly to all staff across the agency.However, the FDIC cautioned that not every employee who applies will be approved for a buyout."We generally do not expect to approve DRP applications for employees who work in resolving failed banks, risk management examinations, FDIC information security or certain other mission-critical positions," the email informed staff. The FDIC also wrote that, where necessary, the agency will impose a "cap" on the number of separation incentives to "ensure we can accomplish our mission going forward."The application window for the separation incentive programs will run from April 28 through May 5. According to a timeline included in the staff communication, the FDIC plans to notify employees of final approvals or denials by May 13.On Monday, the agency also told staff that the goal of its Workforce Optimization Initiative is to streamline its organizational structure while preserving its core congressional mandates: insuring customer deposits, examining banks and resolving failed institutions."To achieve our new structure, we focused on a number of principles, including identifying sections and offices within the organization that can fulfill their missions with a smaller staffing footprint, increasing supervisory spans of control and reducing the number of managers, and reducing duplicative, administrative and support staff across the agency," the email told staff. "FDIC leadership is committed to supporting all employees throughout the implementation of this initiative."A few weeks prior to the announcement of formal staffing cuts, a small team from DOGE began working inside the FDIC as part of a broader White House-led push to shrink the federal bureaucracy. The National Treasury Employees Union — which represents employees from 37 departments and offices, including FDIC staff — has criticized DOGE's efforts. The American Federation of Government Employees also sued the Trump administration in February, challenging mass firings of probationary employees.The FDIC did not immediately respond to requests for comment.

Frank Gargano The firing of the two Democratic members of the three-member board of the National Credit Union Administration — leaving only Republican appointee Chair Kyle Hauptman in place — has triggered a wave of uncertainty around how far a solo board member can go in regulating some of banks' main competitors. The National Credit Union Administration insists it can continue operating with just one board member, noting it has been done before. But legal experts and industry groups say that NCUA rules require at least two members to move any substantive rulemaking. Todd Phillips, an assistant professor at Georgia State University, fellow with the Roosevelt Institute and a former attorney with the FDIC, says the NCUA has left room for legal challenges from consumer advocates or even the banking industry, which has long claimed credit unions enjoy regulatory and tax advantages."If [Hauptman] wants to violate NCUA regulation [by taking regulatory action alone] and no one sues, no one's going to stop him," said Phillips. "But if his actions are challenged by either credit unions or by [community bankers] that could pose problems."Following the termination of two of its three board members, the National Credit Union Administration sought to reassure stakeholders Friday that it retains the authority to operate under the leadership of a single board member."Please be assured that the NCUA has precedent and standing delegations of authority in place to continue performing all operational and statutory requirements under the authority of a single Board Member," according to the NCUA statement, which was attributed to the board rather than Hauptman personally. "It is the NCUA's long-held view that a single Board Member constitutes a quorum when there are no other Board Members."The NCUA cited the example of former Chairman Dennis Dollar, who in 2002 served as the sole board member during the George W. Bush administration for roughly two months. During that time, Dollar conducted board meetings, cast votes and made administrative and operational decisions on his own — actions the agency now frames as a precedent for its current position.Still, the agency has not publicly outlined the specific legal basis for operating with a single board member, leaving open the possibility of legal challenge. Notably, Kyle Hauptman — the NCUA's lone remaining board member — has not technically made any direct public statements. All official communications have instead been issued under the name of the agency, a move that some see as a sign of legal caution.While the credit union trade group America's Credit Unions said Friday it will continue to engage the agency to seek clarity on next steps during this interim period — deferring to the NCUA's position in updated FAQs to its members following the action — the trade group acknowledged that the precedent cited by the agency limits what a single chair can do in a release answering stakeholder questions updated on Friday. "Using his tenure as guidance, certain Board-level functions may continue under a one-member Board, particularly administrative, supervisory, and delegated actions," an America's Credit Unions answer to a frequently asked question stated. "However, new regulations, amendments to existing regulations, or rescission of existing regulations may remain constrained."In this case, NCUA regulations — outlined in 12 CFR § 791.2 — that states without a quorum of at least two members, the agency's ability to take new official actions may be limited. "New regulations, amendments to existing regulations, or rescission of existing regulations may remain constrained by the requirements of 12 CFR § 791.2 (requiring the agreement of at least two of the three Board members) as former Chairman Dollar did not approve or rescind any rulemaking during his tenure as sole NCUA Board member," America's Credit Unions said in their FAQs. "According to regulation, the sole remaining member, as Chairman, cannot unilaterally issue regulations — formal rulemaking by the agency would require at least a two-member Board vote."America's Credit Unions' President Jim Nussle, in a call with reporters on Monday, said while the NCUA has provided an initial rationale, he left the door open for that to change in the future. Nussle also said he does not consider the firings executive overreach at this time and said he believes the firings are legal."[The NCUA] will be hanging their hat on the precedent set in 2001 and 2002, involving the most recent or previous time when there was a single chair and their position [is] that they can proceed in conducting a certain amount of business," he said. "We don't know what that will mean just yet, and that interpretation still is likely to evolve over the next days and weeks."Phillips says even the wording of the existing quorum requirement on the board could be subject to litigation. He argues the NCUA's initial statement as attempting to calm stakeholders without providing any clarity, making litigation likely."The statute says a majority of the Board shall constitute a quorum. What does that mean? I'm not exactly sure," said Phillips. "A court might read it to say that you need two of the three total votes, or a court might read it to just say you need a majority of the members [currently] in office. I read that statement as being very hand-wavy, to try to just assure commentators and credit unions that everything would be OK but without providing specifics."The Supreme Court is currently considering a case involving the termination of two Democratic members of the National Labor Relations Board, a case that could challenge the legal basis for independent agency structures generally. If courts ultimately uphold the president's authority to remove board members from independent agencies, it could set a precedent allowing future administrations to swap out entire boards and reshape regulatory agendas with every change in administration. That kind of instability, warned Nussle, could leave financial institutions vulnerable to constant shifts in oversight."Financial services companies appreciate consistency and predictability and so anything that makes that difficult … can be problematic," Nussle said. "Sometimes that will occur in a way that people will like and sometimes it will happen in a way that people may not appreciate. That is the reason why [ACU supports] an independent agency for the NCUA and a full contingency of board members. Historically [that] has helped to alleviate that kind of back-and-forth changes that might interrupt or might cause a lack of consistency, or a lack of certainty."The legal ambiguity around whether NCUA Chair Kyle Hauptman can act alone could further embolden the Independent Community Bankers of America and other bank advocates, who have long argued that credit unions enjoy unfair advantages. If Hauptman moves unilaterally, it could increase the incentive for groups like ICBA to sue. This tension comes as credit unions have more than doubled in assets over the past decade — from $1.02 trillion to $2.17 trillion — even as their overall numbers have shrunk by 30%. Once tightly bound to small, local membership bases, many credit unions have expanded significantly, sometimes by acquiring tax-paying banks. Critics, including at least one member of Congress, have called on lawmakers to revisit the tax-exempt status and regulatory structure of these nonprofit institutions — especially as most banks remain for-profit and subject to corporate taxes."Prolonged instability at the NCUA board raises serious questions about the regulator's ability to rein in billion-dollar credit unions," Mickey Marshall, regulatory counsel for the Independent Community Bankers of America told American Banker. "Large credit unions represent just 10% of the industry but now control nearly 80% of assets, fueled by continued exploitation of their federal tax exemption and rapid acquisitions of community banks. It's critical that the NCUA hold these nonprofit giants accountable and ensure they return to their congressionally mandated mission of serving people of modest means united by a common bond."