Freddie Mac

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

July 3, 2015 - Inside The GSEs

FHFA’s Quarterly Review of the GSEs Points to Profitability

The Federal Housing Finance Agency released its performance review of first-quarter earnings for the GSEs this week and it stands to reason that Fannie Mae and Freddie Mac could post strong earnings for the second quarter. Here’s why: loan production was decent, which means guaranty fee income should be as well. But the real gain could come from rising interest rates. When rates fell during the first quarter, Fannie and Freddie booked $4.2 billion losses from the markdown on the value of derivative securities they use to hedge. Rates increased in the second quarter, which means the question now becomes: how much of a gain will the two book? Fannie Mae and Freddie Mac reported continued profitability in the first quarter of 2015...


July 3, 2015 - Inside The GSEs

Investors Author Conservatorship Report, Argues Fuzzy Math

Two activist investors have authored a report highlighting the debate surrounding the facts and numbers that led to Fannie Mae and Freddie Mac being placed into conservatorship in 2008. In the 27-page report, Adam Spittler and Mike Ciklin argue that the Treasury unfairly justified GSE conservatorship via “tricky accounting” methods. In the second quarter of 2008, the report said Fannie reported a net loss of $2.8 billion. But they noted some discrepancies. “As per our analysis, we must add back the non- cash Loan Loss Reserve of $5.5 billion. After this adjustment, Fannie Mae shows a cash net income figure of $3.2 billion. This is poor evidence of a ‘failing business model,’” said the report.


July 3, 2015 - Inside The GSEs

Access to Credit Gradually Expanding, More Needed

Access to mortgage credit is expanding, according to panelists at a real estate conference in Miami last week, albeit slowly, and some agree alternative scoring models are needed. Franklin Codel, executive vice president with Wells Fargo, said the company has expanded its credit parameters on FHA, Fannie Mae and Freddie Mac loans. “About 10 percent, maybe a little bit more, of the lending we’re doing today, a year and a half or two years ago would have been either an exception or outside our policy. We have expanded our credit box at Wells Fargo, and I think a lot of other lenders have done the same thing.”


July 3, 2015 - Inside The GSEs

G-Fee Report Highlights Gap Between 30- and 15-Year Loans

Guaranty fees as a whole have more than doubled since 2009, from 22 basis points to a record high of 58 bps in 2014, said the Federal Housing Finance Agency in a report released this week analyzing the fees. The 58 bps includes 15 bps of upfront loan-level pricing adjustments and 43 bps as part of an “ongoing fee.”Fees also jumped year-over-year as they were at 51 basis points in 2013. Two FHFA-directed increases in 2012 are the primary drivers for the sizeable increase from 2011, when the average fee was 26 bps, then rose in 2014. Higher fees have been met with strong resistance from originators...


July 3, 2015 - Inside The GSEs

Fannie and Freddie CEOs May See Multi-MIllion Dollar Pay Hike

A pay raise windfall is coming for the CEOs of Fannie Mae and Freddie Mac as the Federal Housing Finance Agency revealed this week the removal of a pay cap and approval of a raise that could reach $4 million each in annual total compensation. The GSE executives, Timothy Mayopoulos of Fannie and Donald Layton of Freddie, each earn approximately $600,000 without bonuses. This amount was part of a salary cap initiated by the FHFA in 2012 in response to concerns voiced by lawmakers. The compensation increase announcements were disclosed in separate filings made by Fannie and Freddie with the Securities and Exchange Commission.


July 3, 2015 - Inside MBS & ABS

Despite Overall Increase in Guaranty Fees, GSE Pricing Was Less Profitable in 2014

Average MBS guaranty fees charged by Fannie Mae and Freddie Mac last year were 7 basis points higher than in 2013, but the government-sponsored enterprises were less profitable last year, according to the Federal Housing Finance Agency. The average MBS guaranty fee was 58 bps in 2014, the FHFA reported, up from 51 bps in 2013. Both components of the g-fee – the loan-level upfront fee (15 bps) and the ongoing annual fee (43 bps) were up from the year before. For several years, 15-year mortgages had been more profitable for the GSEs than 30-year loans, so the fee hike in December 2012 was designed to even them out by raising the fees more for 30-year loans. But instead of narrowing the gap, 30-year loans were even more unprofitable last year, the FHFA said in its annual report on g-fee pricing released this week. This biggest factor may have been self-inflicted as both GSEs ...


July 3, 2015 - Inside The GSEs

GSE Business Surged in 2Q15, Nonbanks Keep Growing

Nonbank seller-servicers continued to claim a larger share of Fannie Mae and Freddie Mac business during the booming second quarter of 2015, according to a new Inside The GSEs analysis. The two GSEs securitized $232.4 billion of single-family mortgages during the second quarter, up 22.3 percent from the first three months of the year. Freddie posted a bigger gain, 28.5 percent, than did Fannie (up 18.0 percent). Nonbank sellers accounted for 46.5 percent of loans securitized by the GSEs during the second quarter. They delivered $107.9 billion to Fannie and Freddie mortgage-backed securities during the period, up 24.7 percent from the first quarter. Among nonbank sellers, the biggest gain was posted by smaller and mid-sized mortgage companies, which accounted for 27.6 percent of GSE second-quarter business.


July 3, 2015 - Inside MBS & ABS

MBS & ABS Issuance Jumped Higher in 2Q15 As Agency Single-Family Market Heated Up

Residential MBS production continued to gain speed in the second quarter of 2015 while non-mortgage securitization remained strong, according to a new Inside MBS & ABS analysis. A total of $419.42 billion of single-family MBS and non-mortgage ABS were issued during the second quarter, an increase of 21.2 percent from the first three months of the year. It was the strongest new issuance total since the third quarter of 2013 and marked the fifth straight quarterly increase since the market hit a cyclical low at the beginning of last year. Most of the gain came from the agency MBS sector, which totaled $352.73 billion in new issuance, a gain of 29.7 percent from the first quarter. All three agencies posted hefty gains, with the biggest coming at Ginnie Mae, where new issuance jumped 46.7 percent to hit $120.36 billion. A lot of Ginnie’s growth is coming from an unusual surge of refinance activity, which accounted for ... [ charts]


July 2, 2015 - IMFnews

Short Takes: More Servicing Deals on the Way? / Another Top Executive Departs Wingspan? / BofA Gaining on Wells? / Impac Gets a Line of Credit / Ex-Lenders One Chief Lands at Embrace

Wells Fargo was the top seller to Freddie Mac in 2Q with $12.6 billion, according to newly compiled figures from Inside Mortgage Finance, but BofA was a somewhat close second...


July 2, 2015 - Inside Mortgage Finance

GSE Business Volume Continued Growing in 2Q15; Purchase-Mortgage Market Strengthens

Fannie Mae and Freddie Mac saw a robust 22.3 percent increase in their single-family business during the second quarter of 2015, according to a new Inside Mortgage Finance ranking and analysis. The two government-sponsored enterprises issued a combined $232.36 billion of single-family mortgage-backed securities during the second quarter. It was their strongest quarterly production level since the third quarter of 2013, and it lifted ... [Includes three data charts]


July 1, 2015 - IMFnews

Short Takes: GSEs Hike LPMI Capital Requirements / Is LPMI Really Riskier? / The Trouble with Mortgage Co-ops and Free AU / Applications Wane / Hiring at NMI

The Consumer Financial Protection Bureau also is reviewing LPMI, but from a different angle: RESPA and the "discounting" of such policies…


July 1, 2015 - IMFnews

Big Pay Raises for Fannie and Freddie CEOs; How Does $4 Million a Year Sound?

A few years back, then FHFA Director Ed DeMarco cut the compensation of the CEOs as a response to lawmaker concerns.


July 1, 2015 - IMFnews

GSEs Securitized $232 Billion in 2Q15, Best Showing Since 3Q 2013

However, refinance loans continued to account for the lion’s share of GSE business, Inside Mortgage Finance found.


June 30, 2015 - IMFnews

A Final Tally From the FHFA: Record G-Fees/LLPAs in 2014

Prior to the financial crisis and the government takeover of Fannie and Freddie, some seller-servicers had “strategic alliance” deals that allowed them to pay under 15 basis points in g-fees...


June 29, 2015 - IMFnews

Short Takes: A Killer Quarter for Fannie and Freddie? / A Shrinking Market: Bad Loans / Turn, Turn, Turn Times / Stonegate’s Third-Party Loan Portal / New Hires for Mortgage Network, Ellie Mae

Why do loan turn times – application to closing – vary so much?


June 26, 2015 - IMFnews

What We’re Hearing: Lowering the Boom on LPMI? / Ex-Goldman Sachs MGDs In Love With Subprime? / Leaving Mortgages for Weed / PIMCO’s Non-Agency MBS Plans / Industry Vet Mike McMahon Retires

Former Goldman Sachs officials sure like the nonprime mortgage space. (It's all about yield.)


June 26, 2015 - Inside MBS & ABS

Ginnie Mae Tops in Agency REMIC Issuance In 1Q15, Credit Suisse First in Underwriting

Ginnie Mae accounted for 40.4 percent of new structured finance deals backed by agency single-family MBS during the first quarter of 2015, making it the top issuer in the sector despite a 3.9 percent drop in volume from the previous quarter. Freddie Mac was the only agency-backed real estate mortgage investment conduit issuer to increase production from the fourth quarter. Credit Suisse saw...[Includes one data table]


June 26, 2015 - IMFnews

Bank Use of Principal Reduction Loan Modifications Spiked in First Quarter

The eight banks tracked by the OCC’s Mortgage Metrics report – including Wells Fargo and JPMorgan Chase – completed 7,571 principal reduction mods in the first quarter...


June 25, 2015 - Inside Mortgage Finance

Fair Lending Expectations Are Shifting From Pricing Toward Greater Access, Experts Say

A number of recent headline-generating fair lending settlements may have focused largely on issues of pricing disparities, but there has been a sea change among policymakers these days moving in the direction of greater access to mortgage credit, some industry experts say. During an Inside Mortgage Finance webinar this week, Jeffrey Naimon, a partner in the Washington, DC, office of the BuckleySandler law firm, said the industry is seeing a pendulum swing from the focal point of concern being loan pricing to loan access. “Especially during the time when subprime loans were available, there was a lot of concern that minority borrowers were being steered into higher-cost subprime loans,” he told attendees. “The adoption of the loan originator compensation rule by the Consumer Financial Protection Bureau affected...


June 25, 2015 - Inside Mortgage Finance

QM ‘Patch’ for Fannie and Freddie Has Opened GSE Market for $133 Billion in Additional Business

The Consumer Financial Protection Bureau boosted Fannie Mae and Freddie Mac business by some $132.9 billion when it gave the two government-sponsored enterprises a free pass on the debt-to-income ratio requirements of the qualified-mortgage rule. For the non-agency world, a qualified mortgage has to have a DTI ratio of 43 percent or less. While the government-insured market has its own QM rules that effectively ignore DTI, a loan eligible for sale to the GSEs is considered a qualified mortgage if it meets all the QM criteria – such as no interest-only payments – other than the DTI cap. From the beginning of 2014 through the end of the first quarter of this year, about 16.3 percent of the loans securitized by Fannie and Freddie had...[Includes two data tables]


June 25, 2015 - IMFnews

Is Mortgage Credit Access Improving? Wells Fargo Thinks So

Franklin Codel of Wells Fargo noted that while it’s a challenging time in the economy and for lenders, many agree that quality and clarity of who owns the risk matters.


June 25, 2015 - IMFnews

Hatteras to Buy Rapidly Growing Pingora, but Won’t Obtain ‘Existing’ MSRs

The sale is expected to close in late August or September and requires the approval of Fannie Mae, Freddie Mac and Ginnie Mae, among others.


June 25, 2015 - IMFnews

QM ‘Patch’ Yields $133 Billion in Additional Business for Fannie/Freddie

From the beginning of 2014 through the end of 1Q15, roughly 16 percent of the loans securitized by Fannie and Freddie had DTI ratios exceeding 43 percent...


June 24, 2015 - IMFnews

With GSEs Making AU Systems Free, Mortgage Cooperatives May Face the Heat

“With the Fannie [Mae] discount gone, I’m not sure it’s worth staying a member,” said this executive, regarding the Lenders One cooperative...


June 24, 2015 - IMFnews

More Potential Trouble for Lender-Paid Mortgage Insurance?

J.P. Wieske, legislative liaison and public information officers for the WIC, confirmed that the state has made an information request, but would not address content.


June 24, 2015 - IMFnews

Slip Sliding Away: Home Mortgage Debt

Sometimes lost in the hoopla over the rising nonbank share of mortgage servicing is that banks have fallen in and out of love with the servicing market for decades.


June 23, 2015 - IMFnews

Short Takes: More Relief from FHA? / Another Mortgage Co. Purchase by Blackstone? / MBA Less Bullish About 2016 / CFPB Unearths Dual-Tracking / A New Prez for Flagstar’s Mortgage Unit

Apparently, the Blackstone Group recently closed on yet another mortgage company purchase...


June 23, 2015 - IMFnews

Surprise (Sort of): Fannie Mae Makes DU Free, Plans to Introduce New Loan Delivery System

Early this month, when Freddie Mac made it automated systems free, Fannie said it would not follow in Freddie’s footsteps...


June 23, 2015 - IMFnews

Aggregators Push Buyback Risk to Originators

And these very same aggregators have made demands of the retail funders they bought the loans from in the first place


June 22, 2015 - IMFnews

GSEs Face Challenges and Risks, FHFA Report Shows

Fannie Mae and Freddie Mac have made progress in improving their corporate governance structure and managing credit risk, but they still face significant headwinds, according to the FHFA’s annual report to Congress.


June 22, 2015 - IMFnews

GSE Buybacks Slow, Most Cases End in Seller’s Favor

A relatively small – even microscopic – percentage of loans securitized by Fannie Mae and Freddie Mac in the past three years have been subject to a repurchase demand, according to a new Inside Mortgage Trends analysis.


June 19, 2015 - Inside The GSEs

Freddie: Credit Quality Improved, Names Tope 3 Loan Defects

Credit quality has improved over the last two years, according to Chris Mock, vice president of single-family quality control for Freddie Mac, but there is still plenty of room for improvement. These days he said the top three common defects are missing documentation, insufficient funds to close, and insufficient income. “The first one is we are unable to calculate income and match it to the income the lender calculated on the loan file,” he said in an interview with Inside The GSEs. “And that one is mainly driven by documentation that is missing when the customer sends us a file.” Mock said that Freddie shares a list of the top 10 missing documents with lenders...


June 19, 2015 - Inside The GSEs

Freddie Completes First NPL Auction for Smaller Investors

Freddie Mac announced its first non-performing loan auction that primarily caters to smaller investors was sold last week to Corona Asset Management XII, LLC. Freddie marketed the Extended Timeline Pool Offering of 157 deeply delinquent NPLs in April and it sold on June 3.The EXPO gives smaller investors who may need more time to secure funds for bidding a longer timeframe to do so.Having smaller pool sizes and a longer marketing timeframe differentiates the EXPO initiative from Freddie’s standard pool auctions. The loans were all based in Miami-Dade County, FL, and have an aggregate unpaid principal balance of $31 million. Freddie said the loans had been delinquent for close to four years on average.


June 19, 2015 - Inside The GSEs

Freddie Mac's STACR Program Evolves, Gains Momentum

Freddie Mac announced its fifth Structured Agency Credit Risk debt note offering in 2015 this week. This $950 million offering comes on the heels of last week’s STACR offering of $425.6 million, which was the first transaction under a new structure that shares a reference pool of loans with a previous transaction. Last week’s STACR Series 2015-HQ2 has a reference pool of single-family mortgages with an unpaid principal balance of more than $30.3 billion. Freddie said the reference pool consists of a subset of 30-year fixed-rate single-family mortgages acquired by Freddie in the first through third quarters of 2013 with loan-to-value ratios from 80 to 95 percent. Analysts from Moody’s Investors Service said Freddie used part of its 58 percent....


June 19, 2015 - Inside The GSEs

Fannie and Freddie Buybacks Down Sharply in 1Q15

Fannie Mae and Freddie Mac both reported sharp declines in mortgage repurchases during the first quarter of 2015, according to a new Inside The GSEs analysis of public disclosures by the two. There was, however, a sharp increase in the volume of unresolved buyback demands. The GSEs reported a combined $491.3 million in mortgage repurchases during the first three months of 2015, a 30.8 percent decline from the fourth quarter of last year. It was also the lowest quarterly buyback figure since Fannie and Freddie began filing repurchase activity reports with the Securities and Exchange Commission back in early 2012. Fannie’s repurchase volume fell 45.8 percent from the previous quarter while Freddie’s was...


June 19, 2015 - Inside MBS & ABS

Non-Agency MBS Settlements Total $10.3 Billion In 2014, Says FHFA; Only Two Cases Still Pending

The Federal Housing Finance Agency settled $10.3 billion in legal claims in 2014 stemming from 11 non-agency MBS issues that go as far back as 10 years ago, noted the FHFA’s annual report to Congress released this week. These lawsuits were filed in 2011 against financial institutions along with some of their executive management including officers and directors. The suits alleged violations of federal securities laws and state laws in the sale of the non-agency MBS to Fannie Mae and Freddie Mac that took place in a two-year period during the housing downturn between 2005 and 2007. A number of issues contributed...[Includes one data table]


June 19, 2015 - Inside MBS & ABS

Little Sign That GSE Sellers Are Expanding Credit Box in 2015. They May Be Tightening

There was widespread expectation that the latest round of seller-friendly changes to the government-sponsored enterprises’ representation-and-warranty framework would encourage lenders to liberalize their credit overlays. So far in 2015, the data aren’t showing it. In fact, the case could be made that credit trends are going the other way. The average credit score for purchase mortgages securitized by Fannie Mae and Freddie Mac was...[Includes one data table]


June 19, 2015 - Inside MBS & ABS

Supply of Residential MBS Declined in 1Q15, But Banks Expanded Their Share of the Market

The outstanding supply of single-family MBS declined 0.7 percent during the first quarter of 2015, according to a new Inside MBS & ABS market analysis. But that didn’t stop commercial banks from continuing to increase their holdings. Banks increased their aggregate MBS holdings by 3.1 percent from the fourth quarter, pushing their share of the MBS market to 22.9 percent. The only other investor group that managed to increase its stake was the credit union industry, which posted a 1.6 percent increase from the previous quarter. The Federal Reserve finally loosened...


June 18, 2015 - Inside Mortgage Finance

QM Is Only Working Because of the GSE Crutch; Lenders Hobbling Forward With New Products

The only thing that kept the qualified-mortgage rule from devastating mortgage production was the temporary loophole that allows Fannie Mae, Freddie Mac and the government-insurance programs to treat loans with debt-to-income ratios above 43 percent as QMs, an industry official said. “Many have referred to QM as the Y2K moment for mortgages: nothing happened. We all thought this thing was going to implode. And yet there wasn’t too much of a glitch,” said Rod Alba, senior regulatory counsel at the American Bankers Association, during the ABA’s annual regulatory compliance conference in Washington, DC, this week. “At the macro level, that’s...


June 18, 2015 - Inside Mortgage Finance

Servicing Market Shrank Again in Early 2015 While Nonbanks Expanded Their Share of the Business

The outstanding supply of home mortgage debt – even what had been the fastest-growing sector of the market – ebbed in the first quarter of 2015. The Federal Reserve late last week reported the supply of home mortgage debt outstanding fell to $9.855 trillion as of the end of March. That was down 0.3 percent from December 2014 and reversed a modest expansion of the servicing market over the second half of last year. While banks, thrifts and credit unions managed...[Includes two data tables]


June 18, 2015 - Inside Mortgage Finance

Agency Jumbo Market Up Sharply in Early 2015 Refinance Boom, Non-Agency Grows More Slowly

An estimated $95.9 billion of mortgages bigger than the traditional agency loan limit were produced during the first quarter of 2015, a new Inside Mortgage Finance analysis reveals. Jumbo production – all single-unit mortgages with loan amounts exceeding $417,000 – was up 7.9 percent from the fourth quarter. That was slightly off the pace set in overall mortgage originations, which rose 12.9 percent from the previous quarter. Conforming-jumbo production was...[Includes three data tables]


June 18, 2015 - IMFnews

Treasury Downplays Talk of Ending GSEs’ Conservatorship, Reiterates Support for Reform

Lew said it’s not the right time to talk about ending the GSEs’ conservatorship and paying dividends.


June 17, 2015 - IMFnews

GSE Buybacks Down Sharply in First Quarter of 2015

Fannie’s repurchase volume fell 45.8 percent from the previous quarter while Freddie’s was down just 1.3 percent.


June 12, 2015 - Inside FHA/VA Lending

VA Leads FHA, Private MIs in Refis, PMIs Over Agencies in Purchases

The VA maintained a sizeable lead in first-lien mortgage refinancing over FHA and private mortgage insurers in the first quarter of 2015 but yielded to both in purchase originations during the same period. According to the Inside Mortgage Finance database, mortgage lenders originated approximately $221.0 billion of refi loans in the first quarter, a 51.4 percent increase from a revised fourth-quarter production estimate of $146.0 billion. Of first-quarter mortgages securitized by Fannie Mae, Freddie Mac and Ginnie Mae, refi loans comprised 61.4 percent, up sharply from 37.6 percent for all of 2014. VA streamline refis accounted for $20.4 billion while FHA refis made up $12.2 billion of refis pooled in agency mortgage-backed securities. FHA’s refi production jumped 57.8 percent in the first quarter. On the other hand, refi loans with private MI accounted for $14.2 billion produced during the ...


June 12, 2015 - IMFnews

What We’re Hearing: Non-QM Lending Still a Pipe Dream? / Time to Start a Non-QM Secondary Market Agency? / Putting Blackstone’s New Mortgage Company in Perspective / CFPB’s ‘Record’ Not Good News for PHH Mortgage

So where is the non-QM business going? Unless, you’re talking non-QM jumbos, it’s safe to say nowhere fast...


June 12, 2015 - Inside MBS & ABS

Mortgage Securitization Rate Remains Soft in Early 2015; MBS Get Slightly Bigger Share of Jumbos

Securitization rates for newly originated home mortgages remained at historically low levels during the first quarter of 2015, according to a new Inside MBS & ABS market analysis. The ratio of new MBS issuance to primary-market mortgage originations was just 71.6 percent during the first quarter. That’s down from 75.4 percent for all of last year and the record high of 88.8 percent back in 2009. The slowdown in securitization rates is...[Includes one data table]


June 12, 2015 - Inside MBS & ABS

Prepayment Risk on MBS Appears to Be Declining with Higher Interest Rates, Burnout from FHA Premium Cut

A large decline in interest rates in the past year created millions of refinance opportunities for lenders, according to industry analysts. However, prepayment risk on MBS backed by Fannie Mae, Freddie Mac and Ginnie Mae appears to be decreasing as interest rates increase. As of the end of April, 7.0 million borrowers were likely to both qualify for and benefit from refinancing, according to Black Knight Financial Services. That was up from 4.5 million potential refi borrowers a year ago as interest rates on 30-year fixed-rate mortgages declined by 70 basis points in that time, according to Freddie’s Primary Mortgage Market Survey. “This is...[Includes one data table]


June 12, 2015 - IMFnews

Mortgage Securitization Rate Remains Soft in Early 2015; Banks Keep More Whole Loans?

The slowdown in securitization is partly due to the lag between origination and MBS issuance, but there are other factors not related to timing...


June 11, 2015 - IMFnews

Short Takes: The 10-Year is Yielding What? / Net Branches Seeking Better Opportunities? / Mortgage Armageddon Will Arrive Any Moment / One Nonbank’s MSR Offerings / Bill Addresses an Old Issue: Eminent Domain

One problem with the (latest) refi boom ending is that some loan officers working at net branches start getting nervous and begin seeking better product menus elsewhere...


June 11, 2015 - IMFnews

Senators Seek Clearer Credit Risk- Sharing Plan for Fannie and Freddie

The six, including Sen. Mark Warner, D-VA, and Mike Crapo, R-ID, are seeking additional information on such things as the role mortgage insurers play in credit risk...


Poll

A lot has been written about the ‘Millennial Generation’ being key to the future of the housing/mortgage market, but how much of your mortgage workforce includes Millennials – those born roughly between the years 1980 to 1999?

Less than 10 percent
11 to 30 percent
Greater than 30 percent
It’s so small we can’t even measure it.
We’re tired of reading about how important Millennials are…

vote to see results
Housing Pulse