Fannie Mae officials said this week their decision to study from Freddie Mac’s inaugural risk-sharing transaction prompted them to take the time to obtain a rating on the deal. Fannie’s Connecticut Avenue Securities Series 2013-C01 is scheduled to close on Oct. 24, according to a presale report released late last week by Fitch Ratings.
The Federal Housing Finance Agency this week made the common securitization platform of Fannie Mae and Freddie Mac a legal entity, filing paperwork with Delaware’s Division of Corporations, creating a limited liability company called Common Securitization Solutions LLC. The new limited liability company will be jointly owned by the two GSEs and will assume Fannie’s and Freddie’s securitization functions.
GSEs Issue Government Shutdown Guidance. Freddie Mac this week followed Fannie Mae in issuing new, temporary guidelines to servicers and sellers of single-family mortgages as the nation began its second week of the government shutdown. The GSEs have temporarily revised their selling guidelines to permit lenders to verify Social Security and IRS transcripts after the closing but before the delivery date of the loan.“Servicers can offer unemployment forbearance to borrowers that have a financial hardship as a result of the shutdown and must suspend credit reporting for those borrowers,” said Fannie.
Fannie Mae and Freddie Mac securitized $285 billion of single-family mortgages during the third quarter, an almost 16 percent drop from the previous three-month period. As for the outlook for the fourth quarter, the industry is nervous.
Despite continuing growth in purchase-mortgage production, Fannie Mae and Freddie Mac saw a marked decline in their overall business during the third quarter of 2013, according to a new ranking and analysis by Inside Mortgage Finance. The two government-sponsored enterprises securitized $284.9 billion of single-family mortgages during the third quarter, a 15.6 percent drop from the previous three-month period. It marked the lowest quarterly production for the GSEs since the second quarter of last year and it was attributable to a sharp drop in refinance activity. Fannie and Freddie securitized...[Includes three data charts]
Large lenders appear to be coping better with the partial federal government shutdown, but that doesn’t mean the megabanks aren’t worried about the situation. According to interviews conducted by Inside Mortgage Finance, lenders big and small are adjusting the way they conduct business in the primary and secondary markets in the wake of the government shutdown, now in its second week. Wells Fargo and JPMorgan Chase, the largest correspondent buyers of mortgages, are waiving...
Capitalizing on the uncertainty of a government shutdown, private mortgage insurers are stepping up to provide conventional mortgage insurance on any loan with FHA documentation that could not close on time due to delays at the undermanned agency. Private MIs say they are “ready to help with FHA uncertainty,” urging lenders to consider switching to conventional mortgage insurance if they have any government-insured or guaranteed loan that is at risk of not closing due to the shutdown. United Guaranty said...
Residential lenders realize that eventually the industry will face lower loan limits for Fannie Mae/Freddie Mac mortgages, but they now hope the day of reckoning won’t come until sometime in the second quarter of 2014. “[The Federal Housing Finance Agency] is still trying to figure out what to do,” said one industry lobbyist who spoke under condition his name not be published. “They never thought they’d face this much resistance.” Industry groups and members of Congress have been besieging the agency with challenges to its authority to lower the limits for the government-sponsored enterprises and pleas to defer any such changes. As reported in the Oct. 4 issue of Inside Mortgage Finance, 13 Senators – including two Republicans – recently wrote...
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