pmuolo@imfpubs.com, bivey@imfpubs.com

House Financial Services Committee Chair Maxine Waters, D-CA, late this week sent a letter to Federal Housing Finance Agency Director Mark Calabria, asking that he freeze “all efforts to raise the capital requirements” for Fannie Mae and Freddie Mac and halt plans to release the two mortgage giants from conservatorship…

The correspondence also requests the FHFA “cease and desist” from finalizing any “midnight rules” or other administrative actions until President-Elect Joe Biden is sworn into office on Jan. 20. There’s just one problem with one of those requests: The FHFA has yet to admit it was plotting to rush the GSEs out the conservatorship door, despite one press report from a large financial services daily…

But Waters, the letter indicates, is irked by something else as well: “It is my understanding that despite requests from my staff for you to testify before the Committee on Financial Services in December, you have chosen to make yourself unavailable until sometime next Congress….”

The thirst for non-QM paper continues to be red hot, thanks, in part, to investors’ desire for yield. It comes down to this: a 5% non-QM, though comparatively risky, is better than a 10-year Treasury yielding 95 basis points. Or so we’ve been led to believe…

Meanwhile, the impairment rate on non-QM MBS was 11.9% at the end of October, down from 13.5% in September, according to dv01, an analytics firm. The impairment rate tracks both delinquent and modified loans.

PennyMac Is Tops Among Correspondent Sellers

PennyMac was the leading seller of correspondent loans to the agencies in 3Q20, with 84.71% of its loan sales coming from that channel. Get more details on what channel combinations are being used to fill the pipeline in IMF’s Agency Channel Analysis. This quarterly data report delves into the channel usage of more than 1,600 lenders, breaking down by channel — retail, correspondent and broker — the originations they delivered to Fannie Mae, Freddie Mac and Ginnie Mae.