Nearly two months after the House and Senate overwhelmingly voted to curtail bonus payments to Fannie Mae and Freddie Mac executives, congressional lawmakers last week approved a final bill to send to the president’s desk for signature. Among the amendments included in the Stop Trading on Congressional Knowledge Act of 2012 – which would bar members of Congress and staffers from using non-public, inside information for personal benefit – are prohibitions on bonus payments to top executives of the two government-sponsored enterprises while they remain in conservatorship. The STOCK Act also...

The steady decline in home loans outstanding in the market continued for a fourth straight year in 2011, with the total servicing market shrinking to $10.291 trillion. That was down 2.2 percent from the previous year. The only sector that has seen any growth was Ginnie Mae servicing, which increased 14.4 percent last year even though FHA lending has begun to taper off. The total supply of Fannie and Freddie servicing was down 1.1 percent and 4.0 percent, respectively, though they still account for the two largest components in the market, 27.9 and 17.3 percent of the amount...(Includes two data charts)

Mounting fears that student loan debt will lead the way to the next credit crisis and legislative proposals to deal with those concerns appear to be having relatively little impact on the student loan ABS market, where new issuance has held fairly steady since the financial crisis. According to Bank of America Merrill Lynch analysts, the spreads for student loan ABS are attractive enough to “turn more positive on (the) private student loan sector.” New issuance of private student loan ABS fell off sharply following the financial crisis. Investors demanded higher risk premiums, said Jonathan...

The Federal Housing Finance Agency is calling for Fannie Mae and Freddie Mac to conduct an analysis of the viability of each company’s multifamily operations without government guarantees, suggesting the possibility of separating the two government-sponsored enterprises’ multifamily and single-family businesses. The GSEs’ mandated review of their multifamily operations is part of the FHFA’s 2012 “conservatorship scorecard” unveiled two weeks ago, which outlines the specific objectives and timelines for the Finance Agency’s strategic plan for the conservatorships of Fannie and Freddie. The multifamily...

The Federal Housing Finance Agency is looking for two good chief executives who are willing to work a “thankless job” for substantially reduced pay and the chance to oversee the transition of Fannie Mae and Freddie Mac from private companies to government entities and perhaps eventually out of business altogether. Working closely with the two GSEs, the Finance Agency is in the midst of discussions with candidates to fill the CEO vacancies at both Fannie and Freddie, according to FHFA Acting Director Edward DeMarco.

The Home Affordable Refinance Program recorded a significant decrease in December despite the implementation of some new HARP 2.0 standards that took hold during the final month of 2011, according to the Federal Housing Finance Agency. The FHFA’s latest foreclosure prevention and refinance report released this week noted that all HARP refis fell 36 percent to 23,323 in December from 36,304 in November.

Unless Congress takes legislative action by the end of the year, Fannie Mae and Freddie Mac’s “unlimited” pipeline of cash support from the U.S. Treasury will be significantly dialed back, a paper by Deutsche Bank cautions. Although agency mortgage market observers have assumed that the Treasury will extend the taxpayers’ unlimited line of credit to the GSEs before the Dec. 31 deadline, a close reading of the authorizing legislation suggests that the Treasury may not be able to extend unlimited support without the approval of Congress, noted Deutsche Bank.

Although the Federal Housing Finance Agency has taken steps to ensure that the GSEs’ mortgage purchases conform to certain underwriting standards, the Finance Agency’s oversight of underwriting standards is limited and requires more attention, the FHFA’s official watchdog concluded this week. The FHFA’s Office of Inspector General found in its audit of FHFA oversight of Fannie Mae’s single-family mortgage underwriting standards that the agency lacks a formal process for reviewing underwriting standards and variances. Instead, it informally reviews and comments on Fannie’s proposed credit policy changes.

Fannie Mae, Freddie Mac and the Federal Home Loan Banks will now be prohibited from taking on mortgages “encumbered by certain types of transfer fee covenants and in certain related securities” under a final rule issued last week by the Federal Housing Finance Agency. The FHFA’s final rule, published in the March 16 Federal Register, generally applies, with some exceptions, to private transfer fee covenants created on or after Feb. 8, 2011, the publication date of the Finance Agency’s proposed rule.