Fannie Mae this week joined Freddie Mac in announcing a front-end credit-risk transfer pilot that will use additional levels of private mortgage insurance, but the so-called deep MI option looks like a long shot. “Credit-risk transfer is the next big thing, and though we’re already three years into it, it’s still very much a work in progress,” said Donald Layton, Freddie’s CEO, during the annual convention of the Mortgage Bankers Association in Boston this week. “About 50 percent of the credit risk that’s coming in is...
Bayview Financial is set to issue the first re-securitization backed by subordinate tranches from risk-sharing deals issued by Fannie Mae and Freddie Mac. Fitch Ratings placed an A-minus rating on the planned $159.60 million Bayview Opportunity Master Fund IVb Trust 2016-CRT1. The transaction is backed by 12 securities from Fannie’s Connecticut Avenue Securities transactions and Freddie’s Structured Agency Credit Risk transactions issued in 2014 and 2015. The securities in the re-securitization are CAS M2 and STACR M3 tranches. All but one of the underlying securities rely...
Thanks to increasing market demand and two expansions of their scorecard caps courtesy of the Federal Housing Finance Agency, Fannie Mae and Freddie Mac could do more than $100 billion in combined issuance of multifamily MBS by the end of 2016 – if they have a strong December, that is. According to Inside MBS & ABS figures, Fannie’s new multifamily MBS issuance in the first nine months of 2016 was up 18.4 percent from the same period last year. Josh Seiff, vice president of multifamily capital markets and trading at Fannie, was...
During the third quarter, total Fannie Mae and Freddie Mac servicing related to single-family mortgage-backed securities nudged slightly higher, according to a new Inside The GSEs analysis and ranking.The two GSEs had a combined $4.5 trillion in single-family MBS outstanding at the end of September. That was up 0.4 percent from the previous quarter, but down 0.4 percent from a year ago. Total GSE single-family servicing is somewhat higher because both Fannie and Freddie have retained portfolios of unsecuritized mortgages. Fannie MBS servicing was actually down 0.2 percent during the third quarter and off 2.3 percent from September 2015. Freddie servicing was up 1.6 percent for the quarter and up...
This week, Fannie Mae launched an initiative that guarantees to alleviate buyback fears on certain loan components for lenders using its underwriting and appraisal tools. Fannie will also automate key processes of verifying loans, including income, through Desktop Underwriter’s new validation service.Under Day 1 Certainty, Fannie said lenders would be relieved from most representations-and-warranty risk related to verifying a borrower’s income, assets and employment using DU. “Those are the big ones,” a Fannie spokesman told Inside The GSEs. He said, “It validates right there and they are good to go,” adding that this is the kind of innovation that helps makes possible programs like Quicken’s Rocket Mortgage.
Fannie Mae and Freddie Mac must approve the change of control of Genworth Mortgage Insurance, whose parent company is slated for sale to Asia Pacific Global Capital Co., a Chinese limited liability corporation. The approval, noted one GSE official, is pursuant to the Private Mortgage Insurance Eligibility Requirements, which were sanctioned by the Federal Housing Finance Agency. If Genworth wants to remain an approved MI, the two GSEs have to approve the transaction. Industry observers who keep a close eye on the GSEs believe the sale approval process could be lengthy given the fact that Genworth’s new parent is a Chinese company. The purchase by Asia Pacific was unveiled earlier this week.
Lenders will be able to use technology to verify a borrower’s income, assets and credit worthiness in 2017 in Freddie Mac’s Loan Advisor Suite. The announcement was made this week on the heels of Fannie Mae announcing changes to its Desktop Underwriter. With the cost of originating a mortgage more than doubling since pre-crisis times, the GSE said the enhancements were designed to help lenders validate the quality of the loans they originate and help keep costs at a minimum. David Lowman, Freddie’s executive vice president of single-family business, said, “We’re collaborating with lenders to create innovative tools that reduce the costs of producing and selling high-quality loans to us.”
The secondary market in transfers of agency mortgage servicing rights gained some momentum during the third quarter of 2016, according to a new Inside Mortgage Trends analysis and ranking. A total of $94.96 billion of Fannie Mae, Freddie Mac and Ginnie Mae MSR connected to newly issued mortgage-backed securities changed hands during the third quarter. That was up 9.4 percent from the second quarter and represented the heaviest volume since ... [Includes two data charts]
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