MBS guaranty fees charged by Fannie Mae and Freddie Mac would not have to increase by much from current levels to shift risk to the private sector, according to a new analysis by Andrew Davidson & Co. However, if policymakers looking to reduce the market share of the government-sponsored enterprises want to expand credit availability beyond the tight standards in the GSE market, g-fees will have to increase significantly. Fannie Mae reported that the average effective g-fee in its third quarter 2012 business was 41.8 basis points, and the GSEs raised their fees by 10 bps during the fourth quarter of last year. A report this week from the Bipartisan Policy Center Housing Commission proposed...
With upwards of $15 billion in nonperforming mortgages expected to be sold at auction this year – and with Fannie Mae and Freddie Mac entering the market – securitizations of these problem loans could take off during the next few quarters. To date, there has been little information about nonperforming securitizations, though a handful of private deals have been issued over the past 18 months, market sources told Inside MBS & ABS. “Deals are getting done...
The proposed “Public Guarantor” to replace the government-sponsored enterprises would not only provide an explicit backstop for qualifying MBS in a post-GSE world, it would also serve as a regulator of sorts under terms spelled out in a housing policy paper issued this week. The report by the Bipartisan Policy Center’s Housing Commission called for a “far greater role” for the private sector in the mortgage market, a continued but limited role for the federal government, the graduated elimination of Fannie Mae and Freddie Mac and reform of the FHA. The BPC’s plan calls for...
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