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.
Regulatory reforms initiated after the 2008 financial crisis seemed to work as intended during the COVID-19 downturn, according to participants at the ABS East conference.
Originations of expanded-credit mortgages increased by 2.5% in the third quarter on a sequential basis. But the sector lost market share as lenders continued to focus on GSE refis. (Includes data chart.)
In the twilight of the Trump administration, the FHFA is taking steps that could make the non-agency market more competitive with the GSEs. A Democrat in the White House could mean otherwise.
Proposed standards by state regulators for nonbank servicers could cause problems for smaller firms, according to industry attorneys. But state regulators defended the proposal ahead of the comment deadline.
Select Portfolio Servicing gained ground during the third quarter but Shellpoint Mortgage Servicing remained the top servicer of non-agency MBS. (Includes data chart.)