The average daily trading volume in agency MBS totaled $195.7 billion in April, the lowest reading of the year and third worst over the past 12 months, according to figures compiled by the Securities Industry and Financial Markets Association. The low trading volume is an indication that liquidity is drying up, but it also reflects a decline in new agency MBS being created. According to figures recently compiled by Inside MBS & ABS, lenders issued...

Officials at Fannie Mae and Freddie Mac say pilot deals that feature added primary mortgage insurance at the front end of the securitization process are a useful addition to their credit-risk transfer programs even if their future looks somewhat limited. Speaking at a CRT conference in New York City this week, Robert Schaefer, Fannie’s vice president for credit enhancement strategy and management, called the transactions “a good tool in the toolkit,” but said he doesn’t see them taking over the majority of CRTs. Gina Healy, Freddie’s vice president of credit risk transfers, agreed...

A unique disclosure Freddie Mac is providing in risk-sharing transactions can help provide MBS investors with forward-looking insight about mortgage performance, according to an analysis by Kroll Bond Rating Agency. Freddie started disclosing updated loan-to-value ratios for mortgages in its Structured Agency Credit Risk transactions in March 2016. On a quarterly basis, the government-sponsored enterprise discloses the estimated current LTVs based on Home Value Explorer (HVE), its proprietary automated valuation model. Connecticut Avenue Securities risk-sharing transactions from Fannie Mae don’t include a similar disclosure. KBRA noted...

Some 91.8 percent of REIT MBS holdings ($211.95 billion) are in agency securities…

Freddie Mac’s Gina Healy said the GSE expects to do another front-end MI transaction this month.

The only way Fannie and Freddie are going to lose money is if there’s a hedging loss. And even then, it will be a non-cash charge…

The nonprime residential market is getting more attention as the big product categories hit the skids.

Watt noted the CRT coverage has come at a financial cost – and that Fannie and Freddie have been paying a premium.

What if the FHFA cuts the payments and hands Treasury an IOU? The possibilities are endless...

Although bulk transfers of mortgage-servicing rights were down somewhat in the first quarter, sales advisors are reporting strong activity for the period including more buyer interest and a firming up of prices, even on Ginnie Mae product. According to affiliated newsletter Inside Mortgage Trends, bulk agency MSR transfers that closed in the first quarter were down 35.9 percent from the fourth to $77.3 billion. The biggest downturn was in Fannie Mae product, due to a temporary freeze on bulk transfers as servicers adjusted to new investor reporting requirements. Freddie Mac transfers were actually up from the fourth quarter. More banks and consortiums are extending...