Unanticipated complications with the Dodd-Frank Act appear to have caused Fannie Mae and Freddie Mac to miss a Sept. 30 deadline set by the Federal Housing Finance Agency to initiate risk-sharing transactions with non-agency investors. However, FHFA officials said they continue to work with the government-sponsored enterprises on the issue. “Risk sharing is a complex process that requires time to assess market opportunities, structural considerations, make operational changes, and develop proper risk metrics and controls,” an FHFA spokesman said. “We are moving forward steadily and expect to continue making progress in the coming months.” FHFA officials would not comment...

Certain aspects of the securitization process can and should be standardized to serve a “utility function” for the secondary mortgage market under a new proposed securitization platform drafted by the Federal Housing Finance Agency. Last week, the FHFA released a white paper detailing its proposed framework for a common securitization platform and model pooling and servicing agreement for review and public comment. The FHFA is working...

Some of the major players in what is likely to develop as the real estate owned rental securitization market are still unsure about how exactly the market will develop. However, investor interest in the REO rental sector is strong, even if securitizations will not receive AAA ratings. At a seminar this week hosted by the American Securitization Forum, Suzanne Mistretta, a senior director at Fitch Ratings, confirmed that the rating service will not give initial REO rental securitizations anything higher than a single-A rating. Fitch and others have been approached...

The Federal Housing Finance Agency last week outlined its plans to design a new securitization system and model pooling and servicing agreements to improve Fannie Mae and Freddie Mac operations and help revive the non-agency market. Non-agency market participants welcomed the FHFA’s proposed new utility-like infrastructure but said it should not be mandatory for non-agency transactions. The FHFA said upgrades are needed in the MBS systems of the government-sponsored enterprises and “it makes sense to direct ...

The FHA is starting to lose business to private mortgage insurers and the conventional mortgage market because it is no longer the cheaper alternative, a recent industry survey indicated. Numbers released by the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey show consumer preference for conventional home loans rising as a growing number of homebuyers, particularly current homeowners, used mortgages backed by Fannie Mae and Freddie Mac to finance home purchases in August. The survey noted that current homeowners increased their use of mortgages in June this year while investor participation began ...

Endorsements of new loans under the Home Equity Conversion Mortgage program continued to slide as production fell significantly during first half of 2012. HECM production declined by 25.0 percent from the same period last year to $7.1 billion and fell 4.9 percent from the first to the second quarter. In-house originations accounted for almost all originations reported by top HECM lenders. Initial principal amount at loan origination totaled $4.7 billion. MetLife Bank led all lenders with $2.03 billion, an estimated 63 percent originated in house, and captured a 28.5 percent market share. Production rose 21.6 percent ... [One chart]

Mortgage bankers are concerned about possible limits on the volume of loans they can sell to Fannie Mae and Freddie Mac, and particularly the lack of information about the development of the new rules by the government-sponsored enterprises and their regulator. Fannie and Freddie are concerned about the ability of some approved seller-servicers to honor repurchase requests and are weighing new volume limits based on a seller’s capital. The Mortgage Bankers Association wants the Federal Housing Finance Agency to bring the issue out into the daylight. “Given the important nature of this issue, the MBA believes that the FHFA should...

The Federal Housing Finance Agency says its proposed new securitization platform could be used now by Fannie Mae and Freddie Mac, as well as by private issuers, but it’s also intended to serve a post government-sponsored enterprise marketplace. Last week, the FHFA issued a call for public comment on a white paper outlining its proposed common securitization platform and a model pooling and servicing agreement. Those plans are also included in the agency’s updated strategic plan issued this week. The 31-page strategic plan – which updates a draft issued by the FHFA in February – sets...

Fannie Mae and Freddie Mac issued separate guidance to their mortgage servicers last week designed to continue the conservator-mandated effort to complement the servicing policies of the two government-sponsored enterprises and to develop a consistent framework for assessing servicer performance. The updated servicing policies seek to harmonize compensatory fee structures, servicer violations and remedies, and servicer terminations and transfer of servicing between Fannie and Freddie. Fannie’s and Freddie’s announcements also include...

The sale of Ally Financial’s bankrupt mortgage unit, Residential Capital, should not proceed unless or until the company provides more information about the deal, specifically whether preexisting contracts will be honored, according to court filings by Fannie Mae and Freddie Mac. The two government-sponsored enterprises objected to the sale via papers filed this week in U.S. District Bankruptcy Court, New York Southern District. The GSEs expressed concern that without changes to the deal as currently proposed, it may threaten the contracts the GSEs have with ResCap to service loans. “The debtors have failed...