Freddie Mac

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

November 25, 2015 - Inside FHA/VA Lending

Around the Industry

Menendez Introduces HAWK Amendment in T-HUD Appropriations Bill. The National Association of Realtors recently sent a thank-you note to Sen. Robert Menendez, D-NJ, for introducing an amendment to H.R. 2577, the Transportation, Housing and Urban Development, and Related Agencies Appropriations Act of 2016, to restore HUD’s authority to offer the Homeowners Armed with Knowledge (HAWK) program. Lawmakers who were concerned about the financial condition of the FHA Mutual Mortgage Insurance Fund denied funding for the HAWK program last year in a continuing spending bill, effectively stalling the program for a year. The HAWK program is a key component of the FHA’s Blueprint for Access, which was designed to open up the credit box for underserved borrowers. Specifically, program participants will benefit from reductions in FHA premiums once they complete ...

November 27, 2015 - Inside MBS & ABS

Fannie Mae Reveals Winning Competitive NPL Bids, Freddie Mac Opens Bidding for Its Eighth NPL Sale

Fannie Mae has announced the winning bids for its third nonperforming loan sale while Freddie Mac has begun accepting bids for its eighth NPL transaction for 2015. Up for sale in the Fannie Mae deal were approximately 7,000 NPLs totaling $1.24 billion in unpaid principal balance, divided among three pools. The winning bidders in the transaction are Fortress, through its New Residential Investment Corp., for the first and third pools and Goldman Sachs for the second pool. The government-sponsored enterprise announced the sale in October to lighten its inventory of NPLs and manage credit losses on its delinquent loan portfolio. The GSE gave up on the severely delinquent loans after attempts to cure them through loss mitigation failed. Investors and ...

November 25, 2015 - IMFnews

Short Takes: Finance of America Joins MBA / Freddie Mac Bullish on Subservicing / Servicing Rights: An Unstable Asset / Investors Unite to Meet TBTF Party Goers in Miami Beach

Freddie notes, “The volume of specialty servicing may shrink as the number of legacy loans dwindles, but specialty servicing is likely to remain an active part of the mortgage servicing industry…”

November 24, 2015 - IMFnews

Short Takes: Loan Brokers See a Drop in Market Share / NAR, Others Want GSE Language Attached to Spending Bill / Who Said Treasury Wants to Sell Its Preferred Stock Anyway? / Fannie and Freddie are Not Equal / Angel Oak Offers a 10 Percent Subprime Loan

In case you’re wondering, Fannie Mae has a market capitalization rate of $12.28 billion, Freddie Mac $6.86 billion. Why?

November 24, 2015 - IMFnews

IMA Working on MSR Deals that Could Net Almost $3B of Flow and Bulk

It may be holiday week, but Interactive Mortgage Advisors is out with a handful of new MSR offerings...

November 24, 2015 - IMFnews

Freddie Mac: Regulation Could Re-Ignite Consolidation of the Servicing Market

"Many servicing functions resemble the assembly line processes used in auto manufacturing," said a new report from Freddie Mac.

November 24, 2015 - IMFnews

Is a Cut in Fannie/Freddie Guaranty Fees in the Cards for 2016?

Barclays believes there is both an economic argument and a policy argument for reducing GSE guaranty fees…

November 23, 2015 - IMFnews

Mixed Views Abound on GSE Loan Limits

The 2008 Housing and Economic Recovery Act stipulated that the baseline limit could not be lowered when house prices were falling. And during recovery, there could be no increase until the HPI reached its previous high, in the third quarter of 2007.

November 23, 2015 - IMFnews

Evidence Points to a Slight Expansion of the GSE Credit Box

Despite changes to GSE to representations-and-warranties policies, lenders are still avoiding the riskiest segments of the market.

November 20, 2015 - Inside The GSEs

GSE Roundup

FHFA Seeking Comments on Borrower Survey. The Federal Finance Housing Agency is seeking public comments concerning the information collection known as the “National Survey of Existing Mortgage Borrowers” (NSEMB). The NSEMB will be a periodic, voluntary survey of individuals who currently have a first mortgage loan secured by single-family residential property and will consist of about 80 to 85 questions. The comment period ends Jan. 11. SIFMA Supports Nomura’s Appeal in FHFA Case. The Securities Industry and Financial Markets Association recently filed an amicus brief in support of the defendants to reverse a case in which the Federal Housing Finance Agency argued that Nomura Holdings sold shoddy mortgage-backed securities to Fannie Mae and Freddie Mac.

November 20, 2015 - Inside The GSEs

Unexpected Rate Changes Affected GSE Hedging Losses in 3Q15

The hedging effects of Fannie Mae and Freddie Mac – including instruments bought to protect the value of agency MBS – had different results in the third quarter as interest rates unexpectedly declined and stayed low for several weeks. Overall, Fannie booked $2.6 billion of negative charges against the value of its derivatives in the third quarter, while Freddie booked a much larger charge on its hedging activities: $4.2 billion. The differential did not pass without notice, especially since earlier this month Fannie reported a companywide profit of $2.0 billion and Freddie spilled red ink of $475 million. Even Federal Housing Finance Agency Director Mel Watt chimed in on Freddie’s loss, a rarity for the regulator who usually only issues statements when he has to.

November 20, 2015 - Inside The GSEs

FHFA Expands NSI to Prevent Foreclosures in Hard-Hit Cities

After launching pilot programs in Detroit last year and Chicago earlier this year, the Federal Housing Finance Agency recently announced that it is significantly expanding its foreclosure prevention initiative by adding 18 new markets. The Neighborhood Stabilization Initiative gives community organizations the first opportunity to buy foreclosed properties from Fannie Mae and Freddie Mac. Beginning in December, NSI will grow to the 20 markets that suffered the most from the housing crisis. Each GSE had at least 100 real-estate-owned properties valued at less than $75,000 in each of those markets. The goal of the program is to help stabilize neighborhoods by letting local community organizations get an exclusive first look...

November 20, 2015 - IMFnews

What We’re Hearing: FHA Premium Cut Coming…Eventually / A 4 Percent Capital Minimum for the FHA MMIF?/ Good, Let the Banks Leave / Tony Hsieh Addresses Scuttled IPO / Can loanDepot’s LOs Surf? / New Day Fined by the NYDFS

In the same blog post, Hsieh – who did not talk to the press about the scuttled IPO – described loanDepot as a “unicorn startup,” calling it “one of the very few success stories not from Silicon Valley.

November 20, 2015 - Inside MBS & ABS

Moody’s Praises Freddie’s Second Whole-Loan Securities Deal, Noting Features Better Than Non-Agency MBS

The second whole-loan securities risk-transfer transaction from Freddie Mac received a rating from Moody’s Investors Service. The rating service said the $634.64 million deal included a number of improvements compared with non-agency MBS, which have a similar structure. Much like non-agency MBS, the deal was backed by mortgages and included senior and subor-dinate tranches available for purchase by investors. The M1 tranche of FWLS 2015-SC02 ...

November 20, 2015 - IMFnews

Strong Opposition to FINRA Proposal on Margin Requirements for TBA MBS

FINRA made some concessions to the industry in the proposal issued in October, but many MBS traders warned of dire consequences if the proposed margin requirements take effect.

November 20, 2015 - IMFnews

Bank MBS Holdings Soar to a New Record in 3Q15; BofA Especially Hungry

Bank of America grew its MBS holdings by a stunning 22.7 percent in the third quarter, according to Inside MBS & ABS.

November 19, 2015 - Inside Mortgage Finance

Government Lending Bucked 3Q15 Downturn In Originations, Purchase Volume Up Sharply

The bottom fell out of the mortgage-refinance market in the third quarter of 2015, and not even a historic surge in purchase-money lending could pick up the slack, according to a new Inside Mortgage Finance analysis and ranking. An estimated 32.5 percent freefall in refi originations during the third quarter had a much bigger impact on the conventional market than on government-insured lending. Conventional-conforming mortgage production fell ... [Includes two data charts]

November 19, 2015 - IMFnews

Government Lending Bucked the Third Quarter Downturn Trend

An estimated 32.5 percent freefall in refi originations during 3Q had a much bigger impact on the conventional market than on government-insured lending.

November 17, 2015 - IMFnews

Short Takes: Congress Turns Grinch on GSE CEO Salaries / A Disappearing Asset: GSE REO / VantageScore Sees Huge Gain in Orders / Two Harbors Adds Former RBC Vice Chair to Its Board

At the end of fiscal year 2015 the two GSEs had combined REO holdings of 78,738 units, a 36 percent decline from the prior year…

November 17, 2015 - IMFnews

Even Though the GSEs are Shrinking, the FHFA and OIG Keep Adding Employees

In a past audit, the OIG criticized the FHFA for lacking a “sufficient number of examiners.” In the new budget, the FHFA plans to increase its examinations head count to 275 from 248 in FY 2015.

November 17, 2015 - IMFnews

REITs Continue to Shy Away from Mortgage Securities; Is the MBS ‘Trade’ Dead?

This observer, requesting anonymity, said bluntly that the MBS “trade” is over, a summation that is bolstered in part by so many Wall Street firms either closing their trading desks or scaling back...

November 13, 2015 - Inside Nonconforming Markets

News Briefs

Freddie Mac is preparing to sell its second “Whole Loan Securities” transaction, according to a presale report from Moody’s Investors Service. The planned $634.64 million deal will be structured like a non-agency mortgage-backed security with senior tranches and subordinate tranches. Unlike the first deal from the government-sponsored enterprise, the planned issuance received ratings on some of the subordinate tranches. The unrated senior ... [Includes three briefs]

November 13, 2015 - IMFnews

What We’re Hearing: loanDepot, What the Heck Happened? / Marketing Itself as Technology and Consumer Finance Firm / Eventually, the IPO Will Happen / Salivating Short Sellers? / Waiting on the FHA MMIF Audit

A handful of hedge funds were salivating at the prospect of shorting loanDepot's stock...

November 13, 2015 - Inside MBS & ABS

SIFMA Supports Nomura’s Appeal in FHFA Case, Questions Claim Timeframe

The Securities Industry and Financial Markets Association recently filed an amicus brief in support of the defendants to reverse a case in which the Federal Housing Finance Agency argued that Nomura Holdings sold shoddy MBS to Fannie Mae and Freddie Mac. In the case of FHFA vs. Nomura Holdings, a judge ruled in May, after a three-week bench trial, that Nomura and RBS Securities were liable for the claims brought by the FHFA and knowingly sold bad MBS to the government-sponsored enterprises before the 2008 financial crisis. The MBS were backed by mortgages with an unpaid principal balance of about $2.05 billion at the time of purchase. Nomura appealed...

November 13, 2015 - IMFnews

Recapping the GSEs While Promoting Affordable Housing – Can Such a Concept Fly?

The authors want the Treasury Department to end the quarterly profit sweep and allow Fannie and Freddie to raise about $100 billion in additional capital through several rounds of new common stock sales...

November 13, 2015 - Inside MBS & ABS

Unexpected Changes in Rates Affected Hedging Losses At the GSEs. In the End, It’s All a ‘Wash’ – Right?

The hedging results of Fannie Mae and Freddie Mac – including instruments bought to protect the value of agency MBS – had different results in the third quarter as interest rates unexpectedly declined and stayed low for several weeks. Overall, Fannie booked $2.6 billion of negative charges against the value of its derivatives in the third quarter while Freddie booked a much larger charge on its hedging activities: $4.2 billion. The differential did not pass...

November 13, 2015 - IMFnews

Freddie Mac’s Planned Whole Loan Securities Transaction Receives Rating

The loans to be included in the deal are similar to the types of mortgages that have been included in jumbo MBS issued in recent years.

November 12, 2015 - Inside Mortgage Finance

Study Touts Strategy to Promote Affordable Housing Through GSE Recapitalization

Promoting affordable housing by recapitalizing Fannie Mae and Freddie Mac is the premise of a new study released this week by the Brookings Institution arguing that their conservatorship should come to an end. Obama administration officials have previously rejected such proposals. The paper noted that the Treasury Department’s sweep policy, which takes the bulk of Fannie’s and Freddie’s profits, limits the government-sponsored enterprises’ ability to promote homeownership and expand access to affordable home ownership, especially among low-income households. Robert Shapiro, former Brookings fellow, and chairman of Sonecon, LLC, along with Elaine Kamarck, a senior fellow at Brookings, said...

November 12, 2015 - Inside Mortgage Finance

Is a Five-Year Old Nonbank That Services Just $21 Billion in Loans Worth Upwards of $621 Million?

loanDepot Inc. this week priced its much anticipated initial public offering, valuing its soon-to-be-listed shares – 34.5 million units in total – at $18 each or roughly $621 million, a lofty valuation for a company that owns just over $20.9 billion in mortgage servicing rights. Few in the industry are questioning loanDepot’s explosive growth since its inception five years ago, but eyebrows have been raised about the anticipated size of the deal. “It’s...

November 11, 2015 - IMFnews

Short Takes: Sen. Ted Cruz Wants to Kill HUD / A New 52-Week Low for Altisource Asset Management / Fannie Mae’s HQ Finally Hits the Market / NMI Gets Senior Secured Loan / The Fastest-Growing Servicers Among Us

Sen. Rand Paul, R-KY, said he would not touch the mortgage interest deduction, but Dr. Ben Carson wasn't as friendly...

November 11, 2015 - IMFnews

FHFA Unveils Large Expansion of Areas Where Community Groups Get First Crack at REO

The goal of the program is to help stabilize neighborhoods that were hardest hit by the real estate downturn by letting local community organizations review and purchase foreclosed properties first.

November 11, 2015 - IMFnews

Fannie and Freddie: A Tale of Two Different G-Fees

Fannie and Freddie passed through of $661 million of g-fee money in the third quarter, up 4.6 percent from 2Q...

November 10, 2015 - IMFnews

Short Takes: Goldman and Fortress Win the Bid for Fannie NPLs / It’s Hard Out There for a Mortgage REIT / UG Gets Good Grade on Security / InterLinc Mortgage Hires Former Envoy Executive

The nation’s largest mortgage investing REIT, Annaly Capital Management, reported a $627 million loss in the third quarter compared to a $900 million profit in 2Q.

November 10, 2015 - IMFnews

Freddie Mac Launches Another $1B-Plus NPL Auction; Plenty of Product Left in the Well

According to Freddie’s recent 10-Q filing, the GSE has plenty of NPLs left to sell.

November 9, 2015 - IMFnews

October Tally: A Slowdown in Fannie Mae, Freddie Mac Securitizations

Wells Fargo once again ranked first among all GSE sellers with a market share of 15.3 percent in October, almost triple that of the number two ranked Quicken Loans.

November 6, 2015 - Inside Mortgage Trends

Agency Channel Analysis: Top Sellers 3Q15

November 6, 2015 - Inside The GSEs

Freddie Describes Single-Security Transition Via Legacy PC Exchange

Investors will be able to exchange existing Freddie Mac participation certificates for new single securities when the GSE creates new “mirror” securities to help facilitate the transition. The exchange program will be available when the new single security goes live and Freddie plans to keep it open for the foreseeable future. Held in a Federal Reserve account, the mirror securities will not increase the outstanding principal balance of Freddie MBS, the GSE explained in an update on the exchange program. The mirror securities will track existing Freddie MBS but substitute a 55-day payment cycle for Freddie’s current 45-day cycle. Freddie will pay compensation equal to the fair market value of the 10 days of lost float when...

November 6, 2015 - Inside The GSEs

House Vote to Cap GSE's CEO Salaries Rescheduled

A bill to cap the salaries of Fannie Mae and Freddie Mac CEOs at $600,000 is expected to become law, but has been rescheduled for vote in the House sometime during the week of Nov. 16. The budget vote last week, coupled with the debate over the Export-Import Bank and election of a new House Speaker, resulted in the salary cap legislation being postponed for a floor vote at a later date this month, said Rep. Ed Royce, R-CA. Royce introduced the “Equity in Government Compensation Act” back in May. It would suspend the $4 million compensation packages for Fannie’s Timothy Mayapoulos and Freddie’s Donald Layton that were approved early this year after...

November 6, 2015 - Inside The GSEs

FHFA: Freddie's 2014 Low-Income Home Purchase Goals Not Met

The Federal Housing Finance Agency determined that Freddie Mac did not meet all of its low-income and very low-income home-purchase goals for 2014, according to the FHFA’s preliminary annual housing report released on October 30. Under the GSEs’ affordable housing goals, low-income is for home-purchase mortgages to families with incomes no greater than 80 percent of the area median income, and the very low-income home- purchase goal is for families with incomes no greater than 50 percent of AMI. Freddie fell short of meeting both goals. The low-income home-purchase goal was 23 percent and Freddie ended 2014 at 21 percent. The very low-income home-purchase goal was 7 percent and Freddie topped out at 4.9 percent.

November 6, 2015 - IMFnews

What We’re Hearing: PHH, the Poster Child of Regulatory Scrutiny / $106 Million in Legal Reserves and Counting / Will Rep. Garrett Congratulate Freddie on What Might be a Blow-Out 4Q? / PennyMac Shines / Pinto Slams the Fed

Now that rates are rising, one might expect Freddie to have a blow-out quarter in 4Q. Will Rep. Garrett issue a statement in February congratulating the GSE on a great job?

November 6, 2015 - Inside MBS & ABS

Freddie and Fannie Continue Pruning Retained Portfolios, Biggest Declines in Non-Agency MBS and Whole Loans

Fannie Mae and Freddie Mac continued to reduce their retained mortgage portfolios during the third quarter by a combined $35.2 billion, a period in which Fannie reported a $2.2 billion gain in earnings while Freddie suffered a $475 million loss. Freddie Mac noted that its investments in less liquid assets were $114.2 billion at the end of the quarter, down 8 percent or $10.1 billion from the second quarter. The government-sponsored enterprise attributed this to its ongoing portfolio liquidation and the sales of $3.4 billion of non-agency MBS. Freddie also securitized $4.0 billion of single-family re-performing and modified loans. Since being placed in conservatorship, Fannie and Freddie have been...[Includes one data table]

November 6, 2015 - Inside MBS & ABS

Agency MBS Issuance Declined in October Despite Modest Rally in Refinance Activity

New agency issuance of single-family MBS declined in October as a result of a slowdown in the purchase-mortgage market, according to a new Inside MBS & ABS analysis and ranking. Fannie Mae, Freddie Mac and Ginnie Mae issued a total of $107.19 billion of single-family MBS last month, a 5.6 percent slip from September’s volume. The flow of purchase mortgages securitized by the three agencies was down 9.6 percent for the month, while refinance volume was up 2.6 percent in October. Some of the strength in refi activity is...[Includes two data tables]

November 6, 2015 - IMFnews

Agency MBS Issuance Declined in October Despite Modest Refi Rally

Fannie Mae, Freddie Mac and Ginnie Mae issued $107.19 billion of single-family MBS last month, a 5.6 percent decline from September’s volume.

November 5, 2015 - Inside Mortgage Finance

GSE Earnings Sink in 3Q15; Guaranty Fee Income Up Slightly Despite Lower Rate on New Business

Fannie Mae and Freddie Mac reported a combined $1.485 billion in net income for the third quarter of 2015, a hefty 83.1 percent decline from the previous period. While Fannie reported its 15th consecutive profitable quarter ($1.96 billion in net income), Freddie posted its first loss ($475 million) in four years. Don Layton, Freddie’s CEO, said that earnings volatility “stems from our usage of derivatives to hedge interest rate risks and accounting mismatches associated with the activity. This quarter showed a continuation of that volatility as the accounting mismatch produced a negative $1.5 billion [generally accepted accounting principles] earnings, which was enough to tip us into the comprehensive income loss of about $500 million for the quarter. “Utilizing a derivatives hedging strategy can result...

November 5, 2015 - Inside Mortgage Finance

Conforming Loan Limit Highly Unlikely to Change In 2016, Though Some Markets May See Boost

The baseline $417,000 conforming loan limit is almost certain to remain unchanged in 2016, according to an Inside Mortgage Finance analysis of key house-price trends. The Federal Housing Finance Agency recently confirmed that it will use the seasonally-adjusted “expanded data” house-price index as the yardstick for determining whether increases should be made to the $417,000 baseline, which has been in place for Fannie Mae and Freddie Mac business since 2006. As of the second quarter of 2015, the most recent data available, the HPI reading was...

November 5, 2015 - Inside Mortgage Finance

AIG Not Likely to Part With MI Unit United Guaranty … Unless It Gets the ‘Right Offer

American International Group this week cleared the air regarding a potential spinoff of its profitable mortgage insurance division, saying it likes the MI business very much and considers it a “core” asset. In other words, it’s not for sale. Then again, during AIG’s third-quarter earnings call, President and CEO Peter Hancock left open the door to a possible sale of United Guaranty, saying that “over time” the company likes to maintain its flexibility and that if the “right offer to monetize assets” came along, it would ponder a bid. “It gives...

November 5, 2015 - Inside Mortgage Finance

Industry Groups Pitch for GSE Re-Capitalization Against Stiff Obama Administration Resistance

Freddie Mac’s $475 million net loss in the third quarter of 2015 – its first in four years – underscores the need to rebuild capital reserves at the two government-sponsored enterprises and to plan for their emergence from conservatorship, according to some mortgage groups and housing advocates. In a joint letter, the Community Home Lenders Association and the Community Mortgage Lenders of America, both of which represent small independent mortgage lenders, urged President Obama to support recommended revisions to a sweep agreement that prohibits the GSEs from rebuilding capital and to free them from conservatorship. Freddie’s third-quarter loss was...

November 5, 2015 - IMFnews

Short Takes: Stonegate Buries the Lead / IMA Chief Tom Piercy Explains MSR Marks / A Strong Showing for Impac / Fannie Making Progress on Buybacks / Correction

During the financial crisis Impac’s stock was delisted and its future looked cloudy. But not anymore…

November 5, 2015 - IMFnews

Despite a Hedging Charge of $2.6 Billion, Fannie Mae Posts Net Earnings of $2.2 Billion; ‘Account Surplus’ With Treasury Will Rise Again

Since the federal takeover, the Treasury Department has provided $116.1 billion in assistance to Fannie with the GSE returning (once the 3Q dividend is paid) $144.8 billion...

November 5, 2015 - IMFnews

GSE Conforming Loan Limit Going Nowhere in 2016

The only way the baseline conforming loan limit would be raised for 2016 is if the HPI jumps nearly 10 points...


Should the FHA cut premiums?

Yes, the MMIF has surpassed the 2 percent minimum. It’s time to help first-time home buyers.
Yes, but not until mid-2016 at least, when we see how the fund is doing.
No. The MMIF needs to rebuild and prepare for another potential downturn – just in case.
No. We believe the minimum ratio should actually be raised to 4 percent or higher.
I am undecided.

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