Freddie Mac expanded its re-performing loan program by introducing its first structured sale of seasoned loans last week. The $199 million pilot structured sale is comprised of seasoned loans that Freddie currently guarantees and holds in its portfolio. This includes option adjustable-rate mortgages as well as loans that were originally option ARMs but have been modified through a Home Affordable Refinance Program or other modification. Most of the loans are” less than six months current” or are moderately delinquent, according to Freddie. The transaction involves two steps. In the first step, Freddie sells the loans through a competitive bidding process, subject to a securitization term sheet.
The GSEs simplified their low downpayment mortgage programs and announced updates in their selling guides late last week. The formula to determine a borrower’s eligibility by income limits is the first change aimed at making the application process for Fannie’s HomeReady program easier. “We are simplifying the way that income limits are applied by establishing a single area median income limit of 100 percent,” said Fannie. This is a change from the previous limit, in which the total annual qualifying income could not exceed 80 percent or 100 percent of the area median income, depending on where the home was located.
Freddie Prices $950 Million Multifamily K-Deal. Freddie Mac recently priced a new offering of Structured Pass-Through Certificates (K Certificates), which are backed by underlying collateral consisting of fixed-rate multifamily mortgages with predominantly seven-year terms. The GSE expects to issue nearly $950 million in K-722 Certificates. Borrower Alleges Unfair Post-Bankruptcy Inquiry. A borrower recently filed a lawsuit seeking class-action status against Fannie Mae related to an inquiry made into his credit file after his bankruptcy process was completed. Some attorneys said the case hints at a new type of lawsuit on the horizon stemming from the Fair Credit Reporting Act. The former borrower alleges that the GSE made unauthorized inquiries into his...
Fannie Mae and Freddie Mac saw significant increases in the flow of both refinance loans and purchase-money mortgages during the second quarter of 2016, according to a new ranking and analysis by Inside Mortgage Finance. And for the first time in a long while, nonbank mortgage companies delivered over half of the single-family mortgages securitized by the two government-sponsored enterprises. Fannie and Freddie securitized...[Includes three data tables]
Over the past year, mortgage lenders have been clamoring for pricing breaks from the government-sponsored enterprises as well as the FHA, but so far nothing has changed. But is the industry’s luck about to turn? A handful of GSE watchers interviewed by Inside Mortgage Finance believe there’s a greater likelihood of a cut in FHA premiums before the fall election as opposed to the Federal Housing Finance Agency doing something about loan-level price adjustments or guaranty fees. In general, it’s...
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