The FHFA’s capital requirements include relatively harsh treatment of credit-risk transfer transactions from Fannie and Freddie but that view could change under the Biden administration.
It’s not clear why Freddie’s multifamily profits in the third quarter were more than doubled that of its sister company. Fannie’s g-fee was higher and its portfolio larger while Freddie’s MBS issuance spiked in comparison.
The two GSEs agree that a proposed capital rule would diminish the benefit of credit-risk transfers, but Freddie plans to stay in the market under the current regime. (Includes data chart.)
Freddie has issued several securities backed by re-performing loans during the pandemic. However: Are these loans still protected by the FHFA’s moratorium on foreclosures?
Fannie and Freddie both reported declines in the most severe category of delinquency, but Ginnie's rate was slightly higher in October. (Includes data chart.)
Various announcements by Ginnie, FHFA and the GSEs helped investors in MSRs get more comfortable in recent months. Meanwhile, use of Ginnie’s PTAP financing option remains minimal.