Trade groups point out the irony of raising mortgage rates at a time when the Federal Reserve is spending more than $40 billion a month on agency securities in an attempt to lower the cost of buying or refinancing a loan.
At the very least, mortgage executives are hoping for a delay in the implementation date on the new refi fee promulgated by Fannie Mae and Freddie Mac.
Despite a sharp drop in GDP in the second quarter, Fannie economists expect mortgage originations to reach $3.4 trillion in 2020, the most since the banner year of 2003.
Although the share of loans four or more payments past due continued to climb in July, total delinquencies and early-stage default rates were lower. (Includes data chart.)
Fannie Mae and Freddie Mac can purchase early forbearance loans until Aug. 31, but they still have to impose steep loan-level price adjustments to limit their risk of losses.
Thanks to a booming origination market, Fannie and Freddie posted strong earnings for the second quarter despite the economic carnage caused by the pandemic. Their capital positions also improved.
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