GSE mortgage sellers repurchased a slightly larger volume of defective single-family mortgages during the first quarter of 2018, according to a new Inside The GSEs analysis.During the first three months of the year, lenders repurchased or made other indemnification on $240.91 million of home loans sold to the GSEs, a 4.6 percent increase from the record low set in the fourth quarter of 2017. Buybacks of Fannie loans were up 27.2 percent, but ... [Includes one data chart.]
Just as optimistic talk of GSE reform was fading, in a surprise move late this week the Trump administration revealed a proposal to end the 10-year conservatorship. The gist of it is to reduce the GSEs’ footprint in the housing market through more competition and provide an explicit U.S. guarantee on conventional mortgage-backed securities that is separate from the federal support for low- and moderate-income borrowers.The three-page proposal, billed as a reorganization plan, is part of a larger “Delivering Government Solutions for the 21st Century” publication revealed on June 21. “This proposal would reorganize the way the federal government delivers mortgage assistance and go beyond...
The Treasury Department wants to reduce the GSEs’ footprint in the mortgage market, according to Treasury Counselor Craig Phillips. He also reiterated, about a week before the administration formally published its thoughts on reform (see story page 3), that ultimately the goal is to take Fannie Mae and Freddie Mac out of conservatorship. He said that at 70 percent the federal share of housing is clearly far too high. The Treasury official spoke at a Bank of America Merrill Lynch mortgage and housing finance conference in New York last week that was closed to the press. BAML provided a report on his remarks.
Fannie Mae and Freddie Mac are both working on upgrades to the servicing marketplaces they operate that facilitate the sale of flow servicing rights into the secondary market. The goal is to make the MSR sales process quicker, seamless and more transparent – and at no cost to the loan seller. On the surface it all sounds good, but a handful of investment banking executives told Inside The GSEs they’re worried about the future direction of the servicing marketplaces and want to make sure they don’t encroach on their turf. None of the firms that broker the sale of MSR were willing to go on the record regarding their gripes.
Fannie Mae and Freddie Mac recently updated their servicing guides with a new consolidated forbearance plan to help servicers assist struggling borrowers. There will now be one single policy for forbearance plans. Fannie noted that the goal was to make it easier for servicers to assist borrowers who are experiencing a short-term hardship and to simplify servicing by making it more efficient. The plan covers challenges related to unemployment, unique hardships, military service, and disaster events. This also helps simplify the GSEs’ policies on disaster assistance. Under the new requirements, the servicer may approve forbearance plans that last up to six months and may offer consecutive forbearance plans of up to 12 total months without requiring a Borrower Response Package.
Fitch Accepts GSE Valuation Tools in New RMBS Criteria. Fitch Ratings updated its residential mortgage-backed securities criteria to allow Fannie Mae’s Collateral Underwriter and Freddie Mac’s Loan Collateral Advisor to be used as third-party support of original appraisal in U.S. RMBS transactions. This allows for use of CU or LCA in support of appraisals for conforming and non-conforming loans that are less than two years old and are secured by one-unit single-family properties. FHFA’s Fifth NPL Sales Report. Fannie Mae and Freddie Mac sold 90,921 nonperforming loans with a total unpaid principal balance of $17.4 billion through Dec. 31, 2017, according to the most recent NPL sales report. NPLs sold had average...
MBS guarantee fees currently charged by Fannie Mae and Freddie Mac are at levels sufficient to meet capital requirements recently proposed by the Federal Housing Finance Agency, according to industry analysts. The proposal could also bring attention to cross-subsidization in g-fee pricing, especially under a new FHFA director.
One former loanDepot official had this to say about the rumor: “It makes sense. loanDepot has plenty of loan officers handling inbound leads. Amazon could create a ton more and compete with Quicken….”
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