Leading Republicans and Democrats on the Senate Banking, Housing and Urban Affairs Committee this week launched an ambitious effort to draft a bipartisan housing-finance reform bill, and possibly approve it by year end. Several lawmakers from both sides of the aisle cited a growing consensus about how that reform should be undertaken, with most agreeing on the preservation of the to-be-announced market and the need for an explicit government guarantee for MBS backed by conventional mortgages. Committee Chairman Mike Crapo, R-ID, listed...
The Federal Housing Finance Agency this week held a one-day workshop on the single-family rental market, a sector in which Fannie Mae and Freddie Mac could become bigger players depending on how much their regulator allows them to do. According to industry officials, both government-sponsored enterprises have proposals pending with the agency for financing single-family rental operators. The FHFA, Fannie and Freddie all declined to comment on what’s in those proposals. According to an agenda of the meeting provided to Inside MBS & ABS, speakers at the workshop included...
The Federal Reserve took some pointed criticism on Capitol Hill this week over its handling of monetary policy since the end of the Great Recession, including its support of the housing and mortgage markets through its unprecedented quantitative easing programs. “I don’t think the added gross domestic product growth we’ve had over the last 90 months will be proven to have been worth ballooning the balance sheet from $900 billion to $4.5 trillion,” Rep. French Hill, R-AR, said during a hearing this week by the House Financial Services Subcommittee on Monetary Policy and Trade. He also said...
FUN FACT: Between 2000 and 2007, roughly $2.726 trillion of subprime residential loans were originated nationwide. Last year, just $2.0 billion were funded.
During a Senate Banking, Housing and Urban Affairs Committee hearing late this week housing finance reform options, there appeared to be a consensus about preserving the parts of Fannie Mae and Freddie Mac that work and providing better access to credit for small lenders. There was also more confidence that GSE reform could be addressed sooner rather than later. Committee Chairman Mike Crapo, R-ID, said the committee is “actively exploring a number of options.” He said recapitalizing and releasing Fannie Mae and Freddie Mac without significant reform is not a solution and added that it’s important to have affordable access to the 30-year fixed-rate mortgage.
The purchase-mortgage market is beginning to kick into gear, according to an exclusive Inside Mortgage Trends analysis of agency mortgage-backed securities issuance through the first five months of 2017. Collectively, Fannie Mae, Freddie Mac and Ginnie Mae securitized $268.36 billion of single-family purchase mortgages from January through May. That was up 10.5 percent from the same period in 2016. Purchase-mortgage volume has ... [Includes one data chart]
The Federal Housing Finance Agency proposed new single-family and multifamily housing goals for the GSEs to take on over the next two years. The current goals expire at the end of the year, so the new benchmarks are for 2018 through 2020. One of the more noticeable changes was that the FHFA wants Fannie Mae and Freddie Mac to increase the amount of low-income refinances they purchase. Currently, the GSEs’ goal for the amount of low-income refinances is 21 percent of purchases, but that number jumps to 27 percent under the purchase goal. While uncertainty surrounding interest rates remains a factor, the FHFA noted that the low-income...
The National Association of Realtors recommended that the Federal Housing Finance Agency create what it called a “mortgage market liquidity fund” as a way to allow Fannie Mae and Freddie Mac to rebuild capital. In a letter that went out this week to Federal Housing Finance Agency Director Mel Watt and copied to the Treasury, the trade group expressed concerns about the dwindling capital buffer that’s scheduled to hit zero by Jan. 1, 2018.If Fannie and/or Freddie posts a loss, they will need to tap a line of credit with Treasury. And with no capital reserves, NAR said that the taxpayers will feel the impact while access to credit and homeownership will be stifled.
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