Volume 2012 - Number 5
February 3, 2012
FHFA, Freddie Dispute, Analysts Uncertain of Report’s Conclusion of GSE Incentive Against Homeowner Refi
Both the Federal Housing Finance Agency and Freddie Mac are refuting a published report suggesting that a mortgage finance vehicle at one time employed by the government-sponsored enterprise was designed to profit the company by preventing homeowners from refinancing. An article published this week by ProPublica and National Public Radio contended that Freddie stood to profit from hedging investments known as inverse floaters that would pay higher returns if interest rates rose and more homeowners remained in mortgages with high interest rates. According to ProPublica, Freddie purchased inverse floaters...
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This weekly covers the secondary mortgage market, including mortgage-backed securities and asset-backed securities.
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