1.Executive Order: "Commencing the Reduction of the Federal Bureaucracy"

On Wednesday, President Trump signed an order continuing efforts to “shrink the size of the federal workforce,” reinforcing last week’s executive order on reducing government personnel. The administration has made clear its intent to significantly cut federal staff, stating: “It is the policy of my Administration to dramatically reduce the size of the Federal Government, while increasing its accountability to the American people.”

1.1Potential Impact on HUD and FHA

While the specifics of agency reductions remain unclear, concerns persist about deep staffing cuts at HUD. Last week, a HUD union official suggested the department’s workforce could be reduced by up to 50%, initially indicating that FHA would be unaffected. However, that statement was revised earlier this week, with the same official now stating that FHA itself could see staffing reductions of up to 50%. Following these remarks, HUD responded on Wednesday, refuting the claims: “Suggestions FHA will cut half its workforce are not accurate.”

Adding to the uncertainty, Ginnie Mae reportedly terminated 50 newly hired employees last Friday. While these reductions may be part of broader restructuring efforts, they signal potential disruptions in FHA and Ginnie Mae operations, which could affect loan processing and securitization timelines.

HUD Secretary Eric Turner has reinforced the administration’s focus on efficiency, stating that the Department of Government Efficiency (“DOGE”) Task Force will play a critical role in identifying and eliminating waste, fraud, and abuse. Given this directive, further reductions at HUD and FHA remain a strong possibility. The extent of these changes and their impact on FHA-backed lending will become clearer in the coming weeks.

Read the full Executive Order here: Commencing the Reduction of the Federal Bureaucracy

2.Executive Order: "Ensuring Lawful Governance and Implementing The President’s ‘Department of Government Efficiency’ Deregulatory Initiative"

A second executive order issued this week further signals a shift toward deregulation. President Trump has directed federal agencies to limit regulatory actions strictly to those authorized by their enabling statutes, stating:

“It is the policy of my Administration to focus the executive branch’s limited enforcement resources on regulations squarely authorized by constitutional Federal statutes, and to commence the deconstruction of the overbearing and burdensome administrative state.“

This order reinforces the administration’s goal of rolling back federal oversight and ending what it perceives as excessive regulatory intervention. The directive explicitly calls for agencies to eliminate regulatory provisions that lack clear congressional authorization.

2.1What This Means for Mortgage Compliance

With this shift, regulatory agencies such as HUD, the CFPB, and the FHFA may revise or rescind existing guidance, focusing only on enforcement actions explicitly required by federal law. This could lead to:

♦ Reduced enforcement of discretionary regulations

♦ Fewer new compliance mandates from federal agencies

♦ A reevaluation of existing agency guidance not explicitly authorized by statute

While the full impact remains uncertain, mortgage professionals should be prepared for a changing regulatory environment, where certain compliance expectations may be rolled back while others—particularly those tied directly to statutory requirements—remain firmly in place.