The American Securitization Forum has published an implementation guide to the due diligence requirements for securitization positions under the market risk rule issued by the federal bank regulators in August, as well as guidance the Office of the Comptroller of the Currency put out this past June. One of the primary purposes behind the rule and the guidance was to lessen industry dependence on credit ratings and to promote instead greater reliance upon proper due diligence. “With the adoption of the final rules, market participants have been working...

The Home Affordable Refinance Program surged to a record 286,044 loans during the third quarter of 2012, but volume began to slow in September, according to an Inside MBS & ABS analysis of new data released by the Federal Housing Finance Agency this week. HARP business was up 17.8 percent from the second quarter to the third, based on loan count, but overall refinance activity at Fannie Mae and Freddie Mac was up 21.8 percent for the same period. The program for underwater Fannie and Freddie borrowers saw a huge increase in volume at the start of the year as lenders implemented a series of changes in the program. Activity surged again in the second quarter when loan-to-value limitations were largely taken out of the equation. But HARP volume fell off...[Includes one data chart]

The Federal Housing Finance Agency continues to add to its ranks with some three dozen new positions budgeted for the current fiscal year, but despite a full-court press on hiring, the agency’s acquisition of skilled staffers, particularly more examiners, remains a challenge, according to FHFA reports. The FHFA’s Performance and Accountability Report boasted a complement of 574 employees at the close of fiscal year 2012, ending Sept. 30, a 10.6 percent increase from the agency’s reported FY 2011 head count of 519.

Fannie Mae and Freddie Mac have reduced their dependency on U.S. government support, but there may be restructuring issues within the budget talks to resolve the looming “fiscal cliff,” according to Fitch Ratings. Fitch this week affirmed its “AAA” rating for both Fannie and Freddie even as its outlook for the two GSEs remains “negative.” However, the rating agency warned that its outlook for Fannie and Freddie depends upon the economy and the ability of political leaders to come to an accord on taxes and government spending before year’s end.

The Federal Housing Finance Agency has announced this week that the maximum conforming loan limits for mortgages acquired by Fannie Mae and Freddie Mac in 2013 will remain at existing levels. In most of the country, the loan limit – established under the terms of the Housing and Economic Recovery Act of 2008 – are calculated each year. HERA sets loan limits as a function of median home values in local areas.

The Federal Housing Finance Agency’s proposal to levy extra guaranty fee charges on GSE mortgages originated in five slow-foreclosure states attracted nearly universal calls to curtail or even to outright scrap the measure from industry participants and from lawmakers. If implemented as proposed, the FHFA would target Connecticut, Florida, Illinois, New Jersey and New York for an additional, one-shot g-fee of between 15 and 30 basis points in 2013.

Industry groups rallied late this week in opposition to a new effort to use revenue derived from an additional GSE guaranty fee to fund amendments to a jobs bill. H.R. 6429, the STEM Jobs Act, would extend by one year the 10 basis point g-fee increase mandated by Congress last year to pay for an extension in payroll taxes. All of the added revenue from that fee hike, which will remain in effect for 10 years, will go into the U.S. Treasury and not cover Fannie Mae and Freddie Mac credit losses or count toward the GSEs’ other financial obligations.

The Eleventh Circuit Court of Appeals ruled earlier this month that a 2010 Federal Housing Finance Agency directive advising Fannie Mae and Freddie Mac against purchasing mortgages laden with certain first-priority lien obligations under the Property Assessed Clean Energy program is not tantamount to a rulemaking that can be challenged in court. The ruling rejected a challenge by Leon County, FL, to uphold its PACE program. The county claimed the FHFA had engaged in rulemaking without the required notice and comment period in violation of the Administrative Procedure Act.The circuit court’s opinion by Judge Rosemary Barkett found the Finance Agency’s action was consistent with its congressionally defined role as conservator under the Housing and Economic Recovery Act of 2008.

Both Fannie Mae and Freddie Mac retained their dominant shares of mortgage-backed securities with a bit of a boost during the third quarter of 2012, according to an Inside The GSEs analysis.The two GSEs issued a combined $335.4 billion MBS during the third quarter, compared to $273.9 billion during the previous quarter. Fannie and Freddie saw an ample 54.7 percent increase in MBS issuance during the first nine months of 2012 compared to the same period a year earlier.