The Federal Housing Finance Agency is calling for Fannie Mae and Freddie Mac to conduct an analysis of the viability of each company’s multifamily operations without government guarantees, suggesting the possibility of separating the two government-sponsored enterprises’ multifamily and single-family businesses. The GSEs’ mandated review of their multifamily operations is part of the FHFA’s 2012 “conservatorship scorecard” unveiled two weeks ago, which outlines the specific objectives and timelines for the Finance Agency’s strategic plan for the conservatorships of Fannie and Freddie. The multifamily...

The Financial Industry Regulatory Authority, a non-governmental watchdog of the securities industry, has asked the Securities and Exchange Commission to approve proposed amendments designed to increase transparency in to-be-announced transactions involving agency pass-through MBS. The proposed rule changes would establish clear requirements for reporting TBA transactions that are “for good delivery” (GD) or “not for good delivery” (NGD) to enhance the ability of investors to negotiate fair and competitive prices for agency MBS. Based on market standards, the GD and NGD classifications were...

The Federal Housing Finance Agency is looking for two good chief executives who are willing to work a “thankless job” for substantially reduced pay and the chance to oversee the transition of Fannie Mae and Freddie Mac from private companies to government entities and perhaps eventually out of business altogether. Working closely with the two GSEs, the Finance Agency is in the midst of discussions with candidates to fill the CEO vacancies at both Fannie and Freddie, according to FHFA Acting Director Edward DeMarco.

The Home Affordable Refinance Program recorded a significant decrease in December despite the implementation of some new HARP 2.0 standards that took hold during the final month of 2011, according to the Federal Housing Finance Agency. The FHFA’s latest foreclosure prevention and refinance report released this week noted that all HARP refis fell 36 percent to 23,323 in December from 36,304 in November.

Unless Congress takes legislative action by the end of the year, Fannie Mae and Freddie Mac’s “unlimited” pipeline of cash support from the U.S. Treasury will be significantly dialed back, a paper by Deutsche Bank cautions. Although agency mortgage market observers have assumed that the Treasury will extend the taxpayers’ unlimited line of credit to the GSEs before the Dec. 31 deadline, a close reading of the authorizing legislation suggests that the Treasury may not be able to extend unlimited support without the approval of Congress, noted Deutsche Bank.

Although the Federal Housing Finance Agency has taken steps to ensure that the GSEs’ mortgage purchases conform to certain underwriting standards, the Finance Agency’s oversight of underwriting standards is limited and requires more attention, the FHFA’s official watchdog concluded this week. The FHFA’s Office of Inspector General found in its audit of FHFA oversight of Fannie Mae’s single-family mortgage underwriting standards that the agency lacks a formal process for reviewing underwriting standards and variances. Instead, it informally reviews and comments on Fannie’s proposed credit policy changes.

The Federal Housing Finance Agency has announced its roadmap for managing its conservatorship of Fannie Mae and Freddie Mac as it moves toward its ultimate end of reducing GSE market share and building a new secondary mortgage market infrastructure. Two weeks ago, the FHFA rolled out its 2012 “conservatorship scorecard,” which provides more details about the Finance Agency’s revamped strategic plan that was announced last month.

Fannie Mae, Freddie Mac and the Federal Home Loan Banks will now be prohibited from taking on mortgages “encumbered by certain types of transfer fee covenants and in certain related securities” under a final rule issued last week by the Federal Housing Finance Agency. The FHFA’s final rule, published in the March 16 Federal Register, generally applies, with some exceptions, to private transfer fee covenants created on or after Feb. 8, 2011, the publication date of the Finance Agency’s proposed rule.

Effective Sept. 1, Freddie Mac will assess a Reporting Noncompliance Compensatory Fee of up to $15,000 on servicers that fail to report on at least 75 percent of the loans they service by the fifth business day after the accounting cycle cutoff, the GSE noted in an alert to servicers last week. Freddie has upped the fine it will levy from $250 to $5,000 against any servicer that falls short of the GSE’s reporting rules. A second violation in one 12-month period will result in a $10,000 fine, previously $550.