With housing finance reform legislation effectively stalled just short of a Senate floor vote, the industry is beginning to shift its expectant gaze to the Federal Housing Finance Agency to take the initiative as the debate moves toward GSE preservation. Although the reform bill, S. 1217, by Sens. Tim Johnson, D-SD, and Mike Crapo, R-ID, cleared the Senate Banking, Housing and Urban Affairs Committee earlier this month, its less than impressive 13-9 vote margin all but ensures that Senate leadership will ignore the measure’s bid for a floor vote through the remainder of the 113th Congress.

Expect it to take years for the courts to resolve lawsuits filed by private investors in Fannie Mae and Freddie Mac stock, with the odds heavily stacked in the government’s favor, note industry observers. Speaking during a recent Bloomberg Industries webinar on Fannie Mae and Freddie Mac litigation, Brooklyn Law School Professor David Reiss noted it could take the courts up to a year simply to resolve the introductory motions.

Fannie Mae and Freddie Mac are moving forward slowly on the common securitization platform even after the Federal Housing Finance Agency recently narrowed the project, according to an agency official. Bob Ryan, a special advisor to the FHFA, told attendees at last week’s Mortgage Bankers Association Secondary Market Conference that the development of a common GSE securitization platform would take several years. The Finance Agency’s 2014 strategic plan for the GSEs includes clarifying the scope of the CSP project, which has been in the works for over a year.

Over roughly two years, Fannie Mae and Freddie Mac have spent about $65 million on the common securitization platform project, but without employing a timeline on the massive undertaking or a total cost estimate, according to a new report from the Inspector General of the Federal Housing Finance Agency. In its report, released last week, the IG notes that the regulator/conservator of the GSEs has yet to fully employ these “two basic project management tools,” which it deems critical to the project’s success.Although some progress has been made in developing the CSP, the project faces “considerable challenges that could undermine the project.”

Mortgage lenders will benefit from a reduced risk of loan repurchase owing to the easing of borrower performance standards mandated earlier this month by the Federal Housing Finance Agency, according to a report from Fitch Ratings. Fannie Mae and Freddie Mac, at the direction of their conservator, announced a narrow adjustment in how loans with minor payment problems can still qualify for buyback relief if they are current 36 months after origination. The new framework also provides buyback protection for mortgages that come clean in the GSEs’ quality control checks and an alternative to automatic repurchase of loans when private mortgage insurance is canceled.

Fannie Mae last week priced its second credit risk-sharing deal of 2014, the first to be backed by higher loan-to-value mortgages. The $1.6 billion note is the GSE’s third and largest transaction under its Connecticut Avenue Securities series since the Federal Housing Finance Agency ordered both Fannie and Freddie Mac to shrink the GSEs’ role in the U.S. housing market last year. In its latest offering – Series 2014-C02 – Fannie included reference loans with original LTV ratios of up to 97 percent. Previous C-deal offerings included reference loans with up to 80 percent original LTV ratios.

Industry trade groups are calling on the Federal Housing Finance Agency and the Consumer Financial Protection Bureau to be more transparent about how they plan to use the information the agencies want to collect to build the National Mortgage Database. Earlier this year, the FHFA announced it will begin to collect additional, more specific and personal information on borrowers and loans as part of the National Mortgage Database project the agency launched with the CFPB in 2012. An FHFA announcement in the Federal Register noted that under a “revised system of records,” the database will begin collecting demographic and personal contact info for borrowers and their households, as well as loan-level data on mortgage performance.

White House Nominates New FHFA Inspector General. The Federal Housing Finance Agency soon should have a new Inspector General. Last week, the White House nominated Laura Wertheimer as the FHFA’s new watchdog chief. A Washington-based securities lawyer in private practice, Wertheimer would replace Steve Linick, who resigned last summer to serve as the State Department’s IG. Michael Stevens has been filling in as the FHFA’s acting IG. Wertheimer’s nomination has been forwarded to the Senate Banking, Housing and Urban Affairs Committee for consideration.

The use of Federal Home Loan Bank advances among bank and thrift members fell overall during the first quarter of 2014, with three of the top four members showing virtually no quarterly movement, according to the Inside Mortgage Finance Bank Mortgage Database. All of the nation’s banks and thrifts used a combined $392.0 billion in advances as of March 31, 2014, down 3.5 percent from the fourth quarter of 2013 but an 18.7 percent increase from the same period a year earlier. The Federal Home Loan Bank’s Office of Finance in its first quarter combined financial report cited reduced member demand, particularly by large-asset members, for the first quarter decline.

Fannie Mae and Freddie Mac in April reversed more than a year-long streak of declines with monthly increases in the volume of single-family mortgages securitized by the two GSEs, according to a new Inside The GSEs analysis. Fannie and Freddie issued $45.4 billion in single-family mortgage-backed securities in April, a 20.6 percent increase from March. However, April’s MBS issuance was down 63.0 percent from the same period a year ago. In April, GSE refi securitizations rose to $21.2 billion, a 9.5 percent increase since March, making for a refi share of 46.7 percent. On a year-to-date basis, GSE refi securitizations fell 76.7 percent at the end of April.