Freddie Mac

Browse articles from all of our Newsletters related to Freddie Mac.

January 20, 2017 - Inside FHA/VA Lending

Ex-FHA Chief Suggests Common Standards for FHA, VA, USDA, GSEs

A former FHA commissioner is calling for a common national housing policy and regulations, as well as aligned capital standards for FHA and the government-sponsored enterprises in lieu of the current regulatory regime – an idea first put forth by the Mortgage Bankers Association. Brian Montgomery, former assistant secretary for housing and FHA commissioner in the second Bush administration, said the nation’s homebuyers are at a disadvantage due to the lack of a unified, detailed plan for the housing finance system. Montgomery, a current contender for a top executive position at the Department of Housing and Urban Development, urged President Trump to create a new Office of National Housing Policy to develop a “unified and collaborative approach to our nation’s housing policy, including homeownership and subsidized rental housing.” “The prevailing view within the ...


January 20, 2017 - Inside FHA/VA Lending

HFAs to Benefit from FHA Premium Cut, Wage Growth Says Moody’s

The 25-basis-point decrease in the FHA’s annual insurance premiums translates not only to annual savings for homeowners but also boosts the competitiveness of housing finance agency loan products, according to a new report from Moody’s Investors Service. The report regards the latest FHA pricing adjustment as credit positive for housing finance agencies (HFAs) because it would make FHA loans more affordable to borrowers and increase HFA loan originations. The announcement to reduce the annual mortgage insurance premium to its lowest allowable level took stakeholders by surprise. In November, FHA had no plans to lower premiums despite an uplifting actuarial report on the condition of the Mutual Mortgage Insurance Fund. This week, however, there is uncertainty as to whether the Trump administration will allow the reduced premiums to take effect for new loans closing on or after ...


January 20, 2017 - IMFnews

What We’re Hearing: Time for Steve to Talk to Mel / Going to Bed, Disappointed / The GSE Stock Bet: Buy Low, Sell High / Is Pershing Square Losing Money on the GSEs? / NAR Chief Stays Hopeful on MIP Cut

As one former GSE stock analyst told us: “There’s no way they can be privatized. To maintain an AAA rating they would need 25 percent (I’m guessing) capital to assets. Even at 5 percent there is not enough spread to earn a market return on capital.”


January 20, 2017 - Inside MBS & ABS

GSE Shareholder Case Outlook, Will the Trump Administration Make a Difference?

As a number of shareholder lawsuits against Fannie Mae and Freddie Mac hang in the balance, a new administration offers reasons for some to be optimistic on the cases coming to a close and the Treasury’s sweep of the government-sponsored enterprises’ profits coming to an end. During a Jan. 18 call hosted by Investors Unite, legal experts weighed in on the outlook for GSE shareholder cases just days before the inauguration. Plaintiffs have been arguing that a government bailout of the GSEs and the subsequent Treasury sweep was unnecessary and illegal. “As GSE shareholders, we are...


January 20, 2017 - Inside MBS & ABS

GSEs Working on Accounting, Tax Issues Likely To Emerge in the Transition to Single Security

Freddie Mac has begun talking with the Internal Revenue Service and the Securities and Exchange Commission about issues that are likely to crop up as the two government-sponsored enterprises implement the new Single Security, according to a summary of the most recent meeting of the Industry Advisory Group in December. One issue is the tax treatment of compensation that MBS investors receive for converting legacy Freddie participation certificates for the new uniform MBS, which will have a longer payment delay. “Although it is not definitive, we believe the IRS will ultimately view the float compensation as well as any incentive payment that is paid as part of the exchanges as taxable income when received,” the meeting summary states. Freddie provided...


January 20, 2017 - IMFnews

Freddie Mac Talking to IRS About Tax Issues Tied to the Single Security. Is the ‘Float’ Taxable?

One issue is the tax treatment of compensation that MBS investors receive for converting legacy Freddie participation certificates…


January 19, 2017 - IMFnews

Treasury Nominee Mnuchin Shoots Down GSE ‘Recap and Release’ Concept

In general, the Treasury nominee said his goal is to find a “bipartisan solution” to Fannie and Freddie...


January 19, 2017 - Inside Mortgage Finance

Fannie and Freddie are About to Provide a Revenue Gift to the Trump Administration

Thanks to stellar fourth quarter MBS issuance – coupled with higher interest rates at Dec. 31 – Fannie Mae and Freddie Mac are likely to report their best quarterly earnings of 2016, money that will go directly into the U.S. Treasury. According to interviews conducted by Inside Mortgage Finance this week, the general consensus among observers is that the two government-sponsored enterprises will post a combined profit north of $5.5 billion. In 2016, the two guaranteed...


January 19, 2017 - Inside Mortgage Finance

Trump’s Plans for Corporate Tax Reduction Could Prompt Treasury Draw by GSEs and Spur GSE Reform Activity

Legislative reform of the government-sponsored enterprises doesn’t appear to be a high priority for Republican lawmakers, but President-elect Donald Trump’s plans to reduce the corporate tax rate could inadvertently prompt some GSE reform activity, according to industry analysts. As of the end of the third quarter of 2016, Fannie Mae and Freddie Mac had a combined $53.80 billion in deferred tax assets. The DTAs result from differences between the carrying amounts of existing assets and liabilities under generally accepted accounting principles and their respective tax bases. The DTAs are...


January 19, 2017 - Inside Mortgage Finance

The Beat Goes On. Banks Backpedal from Agency Servicing Market in 4Q16, Especially Ginnie Sector

The evolution of the agency mortgage-servicing market isn’t over, though it appears to have settled into a long-term transition by attrition. At the end of 2016, depository institutions serviced some $3.584 trillion of single-family home loans committed to mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae. That was down 1.0 percent from September, a period during which the supply of agency MBS debt outstanding was growing. The depository share of agency MBS servicing fell...[Includes two data tables]


January 19, 2017 - IMFnews

Incenter Selling $4 Billion Freddie Mac Servicing Portfolio

The delinquency rate on the package is just 0.65 percent, based on number of loans…


January 19, 2017 - IMFnews

Nonbanks Increased Agency Servicing by Almost 22 Percent in 2016

Nonbank servicers have a particularly big footprint in the Ginnie market, accounting for 53.6 percent of servicing outstanding at Dec. 31…


January 19, 2017 - IMFnews

If Trump Cuts Corporate Taxes, Fannie and Freddie Might Need a Treasury Draw

Antonio Weiss, counselor to the secretary of the Treasury Department, cautioned that any reduction to the corporate tax rate could prompt a draw from Treasury funds by the GSEs.


January 18, 2017 - IMFnews

Short Takes: Time to Worry About ‘Deferred Tax Assets’? / Good News or Bad News? / A ‘Conceptual Exercise’ / Sen. Elizabeth Warren Won’t be in Attendance / New PAC Chief for MBA

One mortgage insurance lobbyist, when informed of the possibility, called it “great news” while two lenders we interviewed said it was an awful development…


January 18, 2017 - IMFnews

Real Estate Investors Get Invited to Fannie Mae Meeting. The Topic: SFR Loans

The invitation to the SFR meeting provided some hope to real estate investors, who have a hard time obtaining financing...


January 18, 2017 - IMFnews

GSE MBS Volume Hit a 3-Year High in 2016

Although heavy refinancing activity accounted for the fourth-quarter uptick in MBS issuance, 2016 was also a strong purchase-mortgage market…


January 17, 2017 - IMFnews

Servicing Auctions Begin to Heat Up; New Packages from IMA, Phoenix

The lenders selling the MSRs are both nonbanks…


January 17, 2017 - IMFnews

Correspondent Share of GSE Business Edged Higher in 4Q16; Brokers Slumped

United Shore Financial Services was the top seller of broker loans by a wide margin, with $5.83 billion in fourth-quarter activity, more than twice its nearest competitor…


January 13, 2017 - Inside The GSEs

GSE Roundup

Moody’s says HAMP Replacement Program Credit Neutral for CRTs. The GSEs’ new Flex Modification foreclosure prevention program that will replace the expired Home Affordable Modification Program has a neutral credit impact on GSE risk-risk transfer deals. Moody’s said that the volume of modifications and the re-default performance under the Flex program will be comparable to modification levels and performance under the current programs. The firm also noted that the new program will not result in increased modification volume. Servicers have until Oct. 1, 2017, to implement the new program. Freddie’s Recent ACIS Transaction. Last week, Freddie Mac announced its last Agency Credit Insurance Structure of 2016 in the form of a $285 million offering. The GSE said it...


January 13, 2017 - Inside The GSEs

IG: FHFA Should Better Manage Nonbank Servicer Risks

A recent audit showed that the Federal Housing Finance Agency needs to do a better job at managing nonbank risks such as mortgage servicing transfers. In response, the FHFA said it will finalize a risk-based proposal to examine how well the GSEs manage that and other risks by the end of this month. The FHFA’s Inspector General said that the agency has not made sure that both Fannie Mae and Freddie Mac are tackling potential risks. The IG noted that out of three advisory bulletins issued that addressed nonbank servicer risk, one of the GSEs only complied with one of the bulletins.The heavily redacted report doesn’t mention which GSE failed to comply with the bulletins, but a...


January 13, 2017 - Inside The GSEs

Treasury Dept. Talks Housing Progress and New Goals

As the guard prepares to change in a week, Treasury Secretary Jacob Lew said in an exit memo released last week that only legislation can comprehensively address “the ongoing shortcomings of the housing finance system.” In the memo, Lew documents the Treasury’s progress over the last eight years and outlines his goals for the future of the department. He said that fixing the housing finance system remains the major unfinished piece of work of post-financial crisis reform. While he said the housing market has improved, Lew acknowledged that many homeowners and neighborhoods continue to struggle. “A starting point for such legislation should be the principles President Obama laid out in 2013, which stressed a clearly-defined role for the...


January 13, 2017 - Inside The GSEs

Investors Unite Hopes Privatization Leads to Shareholder Fairness

With increased talk of privatizing Fannie Mae and Freddie Mac, Investors Unite wants reassurance that shareholders will be treated fairly. The GSE shareholders rights trade group said, “Now everybody is talking about ending the conservatorship,” in a recent blog posting. While that may be an exaggeration, since the presidential election there has been a renewed interest in bringing the GSEs out of its eight-plus years conservatorship, where they’ve been since September 2008. Recent talks began with and snowballed after Treasury-secretary designee Steve Mnuchin said that getting the GSEs out of government control would be a top priority for the new presidential administration. And Mnuchin said that he plans to do this “reasonably fast.”


January 13, 2017 - Inside The GSEs

GSE Reform Outlook Optimistic, Questions Remain

Although the question of when the conservatorship status of the GSEs will be resolved is still up in the air, a new administration has many speculating that change is on the horizon for Fannie Mae and Freddie Mac. The November election gave Republicans both houses of Congress and the executive branch. This seemed to lend itself to more talks on when and how to reform the GSEs as they approach close to a decade in conservatorship. But, while the sentiment to do something is apparent, agreeing on the best path forward is a different story. And, as in the past, there is no shortage of competing thought processes and proposals.


January 13, 2017 - Inside The GSEs

Fannie Gained Share in Surging GSE 1-Family Business of 2016

Heavy refinance activity at the end of the year lifted single-family business at Fannie Mae and Freddie Mac to a three-year high in 2016, according to a new Inside The GSEs analysis and ranking. The two firms guaranteed $973.72 billion of single-family mortgage-backed securities during 2016, up 18.1 percent from the previous year. That included a 5.7 percent increase from the third to the fourth quarter that was fueled by a 24.5 percent jump in refi loans delivered into new GSE MBS. While both companies saw solid gains from 2015 activity, Fannie’s 23.3 percent increase was more than double the 11.0 percent rise in Freddie volume. [includes two charts]


January 13, 2017 - Inside MBS & ABS

Basel Capital Requirements’ Impact on Non-Agency MBS Activities Uncertain, According to GAO

Capital requirements regarding bank holdings of non-agency MBS increased significantly after federal regulators implemented Basel III reforms in 2014. And while banks have largely been reluctant to re-enter the market for non-agency MBS issuance, a recent report by the Government Accountability Office suggests that the impact of bank involvement in the non-agency MBS market is unclear. The GAO was asked to explain how capital requirements for a mortgage depend on how the loan is financed and how the requirements have changed since the financial crisis. The report was requested by Sen. Richard Shelby, R-AL, who until recently was the chairman of the Senate Committee on Banking, Housing and Urban Affairs. The GAO noted...


January 13, 2017 - Inside MBS & ABS

The Outlook for GSE Reform Brightens, But When and How is a Different Story

Change in the political balance in Washington that put the GOP in control of both houses of Congress and the executive branch has fueled speculation that something will finally be done to resolve the conservatorships of Fannie Mae and Freddie Mac. As in the past, there is no shortage of competing proposals. At an Urban Institute seminar this week, Rick Lazio, former Republican congressman from New York, said...


January 13, 2017 - Inside MBS & ABS

FHA’s New Pricing Adjustment Could Boost Ginnie Mae Issuance, Trigger Prepayments on Premium MBS

The 25 basis-point mortgage insurance premium cut announced this week by the Department of Housing and Urban Development’s departing leadership could switch $50 billion of issuance from Fannie Mae/Freddie Mac business to FHA as well as cause premium Ginnie Mae MBS to prepay faster, according to market analysts. Absent any adversarial pricing by private mortgage insurers, a guaranty fee adjustment by the Federal Housing Finance Agency or a reversal by the Trump administration, analysts with Bank of America Merrill Lynch see up to 12 percent of purchase and 2 percent of refis shifting to FHA. On June 9, HUD Secretary Julian Castro announced...


January 13, 2017 - Inside MBS & ABS

Fourth-Quarter Slump in New GSE Credit-Risk Transfers Leaves 2016 With Small Increase from Previous Year

Fannie Mae and Freddie Mac last year issued a combined $12.93 billion of debt notes that pay investors based on the performance of reference pools, according to a new Inside MBS & ABS analysis of their credit-risk transfer programs. That was up just 2.8 percent from the 2015 volume of new issuance in Fannie’s Connecticut Avenue Securities program and Freddie’s Structured Agency Credit Risk program. It brought total issuance in the two platforms, which started issuance in late 2013, to $38.08 billion. Interestingly, total new single-family MBS production by the two government-sponsored enterprises was...[Includes one data table]


January 13, 2017 - Inside MBS & ABS

Non-Agency MBS Production Tumbled Sharply In 2016; Nonprime Sector Showed Some Life

In 2016, a mere $42.93 billion of non-agency MBS were issued, down 32.5 percent from the previous year, according to a new Inside MBS & ABS ranking and analysis. It was the second-lowest annual output since 2012. The picture would look a bit brighter if Fannie Mae and Freddie Mac credit-risk transfer deals were included, as well as single-family rental securitizations, which both compete for the investors that might be interested in non-agency MBS. But the government-sponsored enterprise CRT deals are debt issues and they couldn’t be any more “agency,” while the SFR securitizations look a lot more like commercial MBS than residential MBS. The prime jumbo market hit...[Includes three data tables]


January 12, 2017 - Inside Mortgage Finance

FHFA to Step Up Pressure on Fannie and Freddie to Manage Nonbank Servicer Risks

The Federal Housing Finance Agency says it will finalize new plans for examining how well Fannie Mae and Freddie Mac manage the risks of mortgage servicing transfers this month. The agency has been under scrutiny by its Inspector General for failing to push the two government-sponsored enterprises to manage risks posed by nonbank servicers. In a new report, the IG said the FHFA has not fully made sure that both GSEs are following the three advisory bulletins it has issued that address nonbank servicer risks, among other things. The report is heavily redacted, making it difficult to determine where FHFA examiners have failed, but it appears that there have been shortcomings for one of the GSEs. The three advisory bulletins address...


January 12, 2017 - Inside Mortgage Finance

Banks and Nonbanks Expected to Make Handsome MSR Mark-ups for 4Q16. But What Does it Mean for Sales?

Banks and nonbanks alike are expected to unveil sizable mark-ups on the asset value of their mortgage servicing rights for the fourth quarter, with the general consensus being that increases will range from 20 to 25 basis points. One servicing advisor, requesting his name not be used, said he has some clients that will book gains of 30 to 35 bps, though he indicated this won’t be the norm. “In general, it’s going to be a huge move,” he said. This source made...


January 12, 2017 - Inside Mortgage Finance

Securitization of Private MI Loans Declined In 4Q16 Despite Jump in Insured Refi Loans

Lenders delivered $68.26 billion of single-family loans with private mortgage insurance coverage, including modified loans, into Fannie Mae and Freddie Mac mortgage-backed securities during the fourth quarter of 2016, according to a new Inside Mortgage Finance analysis and ranking. Fourth-quarter private MI activity for the two government-sponsored enterprises was down 10.1 percent from the previous quarter. Overall, Fannie/Freddie single-family MBS production was up 5.7 percent in the fourth quarter. The drop in MI-insured business at the two GSEs tracked...[Includes two data tables]


January 12, 2017 - IMFnews

FHFA to Step Up Pressure on Fannie and Freddie to Manage Nonbank Servicer Risks

The new FHFA IG report is heavily redacted…


January 12, 2017 - IMFnews

Securitization of Private MI Loans Declined in 4Q16; Full-Year Numbers Look Good

The GSE figures suggest that private MIs saw a measurable drop in new insurance written in the final three months of 2016, but ended the year with a significant increase in volume compared to 2015.


January 11, 2017 - IMFnews

Treasury Nominee Mnuchin Owns a Stake in Fannie & Freddie (Indirectly)

According to his financial disclosure form, Mnuchin lists the value of his Advantage stake at $500,001 to $1 million.


January 6, 2017 - IMFnews

What We’re Hearing: What’s Up with Walter Investment? / MSR ‘Mark-up’ Mania / Rates Heading South, a Bit / Layoff Rumors and Actual Layoffs / Bad News for GSE ‘Recap and Release’?

With rates falling again, lenders may be rethinking any planned layoffs...


January 6, 2017 - Inside MBS & ABS

Treasury Officials Favor Explicit Government MBS Guarantee and Credit Access in all Economic Cycles

The only word from the incoming Trump administration about the fate of Fannie Mae and Freddie Mac is that the prospective Treasury secretary wants to bring them out of conservatorship. The Obama administration, however, commits only to preserving an explicit government guarantee for a “defined class” of MBS. “The explicit government guarantee would be funded by financial institutions and would act as insurance against catastrophic losses,” said the Treasury in a late December blog posting by Jane Dokko, deputy assistant secretary for financial economics, and Sam Valverde, a counselor in the Office of Domestic Finance. However, the authors don’t elaborate on what would shape the defined class. Under the new guarantee, investors would be assured...


January 6, 2017 - Inside MBS & ABS

With So Many Foreign Investors Owning Ginnie MBS, Who Becomes President of the Agency is Paramount

The incoming Trump administration has yet to pick a new president for Ginnie Mae, but foreign investors will be keeping a close eye on the selection for the simple reason they own a ton of the agency’s MBS. According to Sept. 30 figures provided to Inside MBS & ABS, foreign investment in Ginnie MBS is now at a record $552 billion, or roughly 35 percent of all outstanding securities. The agency could not provide...


January 6, 2017 - Inside MBS & ABS

Freddie Mac Issues Its First Risk-Sharing Security Backed by Seasoned Mortgages

In late December, Freddie Mac issued a $934.27 million security backed by seasoned mortgages. It was the first seasoned credit-risk transfer from the government-sponsored enterprise. While Freddie has issued fully guaranteed securitizations backed by seasoned mortgages, Freddie Mac Seasoned Credit Risk Transfer Trust, Series 2016-1 included tranches without a guarantee from the GSE, similar to a non-agency senior-sub MBS. The transaction included...


January 6, 2017 - Inside MBS & ABS

Angel Oak Gears Up for New Non-Agency MBS, While PIMCO and Citadel May Tap the Market Later in 2017

With two of the nation’s largest originators of nonprime and non-qualified mortgages hoping for a record production year in 2017, the mostly anemic securitization market for these types of credits could receive a real boost. But the big question remains: how much will the two firms – Angel Oak Mortgage Solutions and Citadel Servicing Corp. – tap the MBS market? In 2016, the Irvine, CA-based Citadel funded...


January 6, 2017 - Inside MBS & ABS

Heavy Agency MBS Production Lifted Total Asset Securitization to 3-Year High in 2016

Another record year for Ginnie Mae MBS issuance plus strong volume in the Fannie Mae and Freddie Mac programs helped push total securitization of residential mortgages and non-mortgage ABS to a three-year high of $1.698 trillion in 2016. A new Inside MBS & ABS analysis shows that total MBS and ABS issuance – not including commercial MBS – was up 13.3 percent from 2015. Agency production of single-family MBS totaled $1.481 trillion in 2016, up 17.5 percent from the previous year. Over a third of that came from Ginnie, which set a new annual record with $507.5 billion in single-family MBS issuance. The non-agency MBS market was...[Includes three data tables]


January 5, 2017 - Inside Mortgage Finance

FHFA Loosens Rules on FHLBank Advance Collateral And Servicing Transfers for Acquired Mortgages

The Federal Housing Finance Agency late last month issued two final rules that will give the Federal Home Loan Banks somewhat more flexibility in setting collateral requirements for advances and managing their acquired member assets (AMA). A new AMA rule was necessary because the Dodd-Frank Act requires financial regulators to remove references to ratings, which had been used in setting limits on their AMA programs, most of which involve purchases of mortgages from member institutions. Under the new rule, the FHLBanks will be able to choose their own models to determine credit enhancement requirements. The FHFA also deferred...


January 5, 2017 - Inside Mortgage Finance

PHH Shareholders May Get a ‘Special Dividend’ As the Nonbank Finishes its ‘Self Liquidation’

A year from now, PHH Mortgage likely won’t be around, at least not as a conventional mortgage-banking franchise that originates residential loans and retains servicing rights. That’s what analysts and investment bankers who follow the stock now believe, especially in light of the company’s recent announcement that it will sell its $72 billion portfolio of Fannie Mae/Freddie Mac mortgage servicing rights to New Residential Investment Corp. for $612 million or 84 basis points. Once completed, the sale – along with a pending disposal of its Ginnie Mae MSR – will leave...


January 5, 2017 - Inside Mortgage Finance

GSE 1-Family Business Closed 2016 on a High Note, Quarterly MBS Volume Highest Level Since 2013

Mortgage lenders delivered a hefty $299.25 billion of single-family home loans into the mortgage-backed securities platforms at Fannie Mae and Freddie Mac during the fourth quarter of 2016, according to a new Inside Mortgage Finance analysis and ranking. Production in the final three months of 2016 was up just 5.7 percent from the third quarter at the two government-sponsored enterprises. But it was the biggest output since the second quarter of 2013, when the mortgage market was wrapping up a 12-month binge of activity with $337.74 billion in Fannie/Freddie MBS issuance. The strong finish – GSE business was up in each quarter of 2016 – put...[Includes three data tables]


January 5, 2017 - IMFnews

Final GSE MBS Tally for 4Q16: Just Shy of $300 Billion; Best Quarter Since 2Q13

Fannie Mae’s MBS issuance in 2016 was up 23.3 percent from the previous year…


December 30, 2016 - IMFnews

What We’re Hearing: 10 Mortgage Firms to Keep an Eye on in 2017 – and Why

But if you think that Wells Fargo will pull a “BofA” and quietly downshift its presence in mortgages, think again.


December 29, 2016 - IMFnews

Short Takes: A Host of Approvals Needed on PHH Deal / A $10 Million Termination Fee / Sell and Subservice / And the Ginnies Go To… / New Hire for Gateway Mortgage

New Residential is entitled to a $10 million termination fee if the sale falls apart...


December 29, 2016 - IMFnews

To Privatize (or Not) Fannie and Freddie, That is the Question

Tim Howard, a former Fannie Mae CFO, called Mnuchin’s comments “a welcome reset…”


December 29, 2016 - IMFnews

PHH’s ‘Self Liquidation’ Continues. Most of its MSRs Slated for Sale to ‘New Rez’

The sale proceeds exclude estimated transaction fees and expenses of roughly 5.0 percent...


December 28, 2016 - IMFnews

The Largest MSR Deal in Years: PHH Agrees to Sell $72 Billion of Bulk Product to REIT ‘New Rez’

PHH said it will subservice the loans for New Residential "for an initial period of three years, subject to certain termination provisions."


Poll

HUD has announced a 25 basis point cut in FHA premiums, which is slated to take effect in late January. Is your lending shop for or against a cut in FHA premiums?

For. It should help lending volumes.
Against. The private MI sector should take on this risk, not the government.
Too early to say.
I believe the new White House may scuttle the idea so it doesn’t matter.

vote to see results