By some estimates, the enterprises will have to increase guarantee fees by about 3 basis points to offset the lost revenue from FHFA's targeted elimination of LLPAs.
While the FHLBanks tout the utility of the system’s status quo, small independent mortgage bankers push a change that would give nonbanks access to FHLB credit without FHLB membership.
With interest rates rising, investors want higher premiums on credit-risk transfers. And that makes the transactions less economically appealing for Fannie Mae and Freddie Mac. (Includes data chart.)
The Federal Reserve hiked rates by another 75 basis points. But Chair Jerome Powell said the time to begin selling the Fed’s MBS holdings “is not close.”