The NPL sold by the enterprises had an average delinquency of three years and a loan-to-value ratio of 92%. Fannie accounted for 78,281, or two-thirds, of these sales between Jan. 1 and June 30.
Part of the problem is that the current proposed rule was a product of the previous director and much has changed since the rulemaking began a year ago.
Prosecutors allege that co-owners of a company that offered assistance to borrowers going through short sales illegally charged fees for negotiating the sales.
The FHFA director said Fannie Mae and Freddie Mac may fully exit conservatorship as early as 2022. Meanwhile, on FHLBank membership to non-banks, Calabria said the agency will soon be putting out a request for information.
The transaction is structured so that Fannie retains the first 40 basis points of losses. Once the $42 million retention layer is exhausted, re-insurance will cover the next 375 bps of losses.
Treasury claims the GSEs’ unfair advantage is because of their capital treatment. Urban Institute researchers say it’s because of the government backstop of their credit risk.
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