Building the new common securitization platform for Fannie Mae and Freddie Mac may be the easy part. Plugging in the two government-sponsored enterprises is another story. Through the end of last year, the two GSEs had spent about $65 million to build the CSP, according to a report by the Inspector General of the Federal Housing Finance Agency. The IG estimated that Fannie and Freddie this year are spending about $6 million a month to continue that work. In fact, neither the GSEs nor the FHFA have yet come up...
RBS Securities – which is 64 percent owned by the government of the United Kingdom – is shaking up its mortgage trading operation in the U.S., cutting staff and taking a close look at its future in an extremely tough American mortgage market. Officials at the bank’s MBS headquarters in Stamford, CT, did not return telephone calls about the matter, but several lenders and Wall Street executives confirmed that cutbacks have been made at the company over the past week or so. Frank Skibo, a managing director for RBS in Connecticut, and Ara Balabanian, a director in the group, also could not be reached...
In order for the GSEs to exit conservatorship with the full faith and credit of the U.S., they would have to pay the Treasury a fee equal to the value of the government’s backing under the terms of their preferred stock purchase agreements.
Look for the various lawsuits filed by private owners of Fannie Mae and Freddie Mac stock against the federal government to take a “very long time to be decided,” as the courts may take up to a year to resolve just the introductory motions, according to a legal expert. Beyond that, the litigation over shares in the two government-sponsored enterprises could stretch out to the U.S. Supreme Court. Brooklyn Law School Professor David Reiss, speaking during a Bloomberg Industries webinar last week, noted that lawsuits stemming from the savings and loan debacle of 20 years ago give a sense of the possible timeframe, but litigation brought by disenfranchised Fannie and Freddie investors against the government offers an entirely different and deeper set of legal complexities. “These are...
The Center for American Progress, the National Community Reinvestment Coalition and other groups want Fannie Mae and Freddie Mac to survive and are persuading several Democratic politicians to side with them. As for the GOP...
Construction-to-permanent loans are picking up a head of steam in certain markets. “Down here [in Florida] it’s extremely hot,” said Joe Adamaitis, vice president and residential lending manager for Insignia Bank.
State regulators note that their concerns about nonbanks relate to significant growth in recent months prompted in part by increased capital requirements for banks.
In his report, Guggenheim analyst Jaret Seiberg writes, “There is still anger in Congress over having to put cash into the enterprises in the first time."
Lack of Congressional funding, however, has put a damper on the initiative. And lenders generally oppose proposals where they would be charged a subsidy fee.
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