Fannie Mae has priced its fourth and largest risk-sharing transaction to date, a more than $2 billion offering pegged to a pool of mortgages acquired last year, the GSE announced last week. The $2.05 billion note is the GSE’s third transaction under its Connecticut Avenue Securities series issued this year. Last year, the Federal Housing Finance Agency ordered both Fannie and Freddie Mac to shrink their role in the U.S. housing market. The latest offering – Series 2014-C03 – included reference loans with original loan-to-value ratios of up to 97 percent and “is consistent with prior transactions.”
New mortgage insurance eligibility rules proposed earlier this month by the Federal Housing Finance Agency appear likely to cause some MIs to tweak their corporate structures and/or to raise additional capital, note industry observers. In its draft Private Mortgage Insurer Eligibility Requirements, the FHFA directed Fannie Mae and Freddie Mac to revise, expand and align their risk management requirements for mortgage insurance counterparties.The updated financial requirements incorporate a new, risk-based framework that ensures that approved insurers have a sufficient level of liquid assets from which to pay claims.
Critic: CFPB Regulations Ensure Fannie, Freddie Market Dominance. The Consumer Financial Protection Bureau, through its scores of regulations, has stifled and discouraged mortgage market growth away from the GSEs, a critic of the bureau noted during the CFPB’s third anniversary last week. “One of the important effects of the CFPB has been to ensure the continuing market dominance of Fannie Mae and Freddie Mac by the way they have written their mortgage regulations, which give you a pass if you make a loan eligible for sale to Fannie or Freddie or give you very onerous legal risks if you don’t,” said Alex Pollock, a resident fellow at the American Enterprise Institute.
Fannie Mae and Freddie Mac in June rebounded from a decline the previous month with a big boost in the volume of single-family mortgages securitized by the two GSEs, according to a new Inside The GSEs analysis. Fannie and Freddie issued $51.6 billion in single-family mortgage-backed securities in June, a 15.2 percent jump from the previous month. Year-to-date MBS issuance was down 60.9 percent from the same period a year ago.
California remains the top source of new single-family mortgages for Fannie Mae and Freddie Mac, even as Fannie remains the dominant GSE in terms of production through the first half of the year, according to an Inside The GSEs analysis. A total of $56.9 billion in home loans on Golden State properties were securitized by the two GSEs during the first six months of 2014, accounting for 21.0 percent of their total business for the half year.
A healthy housing recovery boosted mortgage origination volume during the second quarter of 2014, but production remains at relatively sluggish levels, according to a new market analysis and ranking by Inside Mortgage Finance. Single-family mortgage originations totaled an estimated $295 billion during the second quarter, up 25.5 percent from the first three months of the year. The first quarter of 2014 was the worst production environment for the mortgage industry since the end of 2000, even falling below the mark set at the depth of the financial crises in the fourth quarter of 2008. In fact, the most recent April-to-June cycle brought...[Includes three data charts]
The first-time homebuyer share of home purchases has increased for four consecutive months, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. First-time homebuyer activity tends to increase through the spring homebuying season, but the first-time homebuyer share is at particularly high levels this year. First-time homebuyers accounted for 37.2 percent of home purchases in June, based on a three-month moving average. That was up from a 34.2 percent share in March, and the last time the first-time homebuyer share of home purchases was at 37.2 percent was September 2010. According to real estate agents, first-time buyers appear...
A federal judge last week granted limited discovery to a hedge fund representing a group of Fannie Mae and Freddie Mac shareholders as they challenge the government’s “net worth sweep” of their profits. But the court will keep a tight lid on public access to the documents in a nod to the government’s claim that a leak could have dire economic consequences on the mortgage market. Fairholme Capital Management has been pushing hard for discovery and access to internal government documents since the shareholder filed suit last summer demanding that the Treasury Department void its August 2012 Third Amendment to its preferred stock purchase agreement with Fannie and Freddie. In her ruling, Judge Margaret Sweeney of the U.S. Court of Federal Claims was...
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