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(Read more on the debt and equity markets and the multifamily market .)

WASHINGTON, DC-The National Multi Housing Council met with James Lockhart, the director of the Office of Federal Housing Enterprise Oversight, on Sept. 13 to discuss the possibility of raising Fannie Mae and Freddie Mac’s portfolio lending limits. The informal sit-down followed a letter several housing organizations, including the Mortgage Bankers Association, the National Association of Home Builders and the National Association of Realtors, sent to the agency at the end of August requesting a temporary increase in the caps on the investment portfolios of Fannie Mae and Freddie Mac. Their rational was that such a move would help to defuse the growing debt crisis. That same week Lockhart had declined to increase the portfolio caps on the GSEs after receiving a request from Fannie Mae president and CEO Daniel H. Mudd for a “moderate” increase in the range of 10%.

David Cardwell, NMHC’s VP of Capital Markets and Technology, tells GlobeSt.com that NMHC wanted to communicate its interest in seeing the caps increased, at least on a temporary basis, as both Freddie and Fannie rely heavily on portfolio lending for their purchases. “If one or both of those companies are restricted in what they can purchase it could have a chilling impact on borrowers, especially given the disruption in conduit marketplace. So much of the volume Fannie and Freddie are doing right now is a result of the problems that the conduit market is having.”

At the meeting, Cardwell says, Lockhart indicated that the agency is still considering a range of options–echoing to a large extent what he said when he first released the letter explaining why he was declining to raise the caps for the moment. “I don’t know if they plan on raising the limits or not,” Cardwell says. “They have left the door open to doing that; whether it is a crack or wider, is hard to tell right now.”

One problem, he speculates, is that the regulatory agencies are focused on the subprime crisis right now “and they haven’t been as focused on the indirect impact the debt crisis is having on the multifamily sector.”

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