GSEs

Browse articles from all of our Newsletters related to GSEs.

December 14, 2017 - IMFnews

MBA Chief Dave Stevens: The GSE Capital Buffer is a Distraction

The CHLA repeated its plea that FHFA Director Mel Watt withhold GSE dividend payments to Treasury and allow Fannie and Freddie to build capital…


December 14, 2017 - IMFnews

Short Takes: Keeping Tabs on GSE Dividends / The GOP Tax Plan and DTAs / Good News for ‘Conforming’ Jumbos? / LendingTree Getting Frothy? / First Republic Bank Stands Out in Second Liens

The share price of online loan broker LendingTree is looking a bit pricey these days at $337.80 a unit...


December 14, 2017 - IMFnews

Stop the Presses: A GSE Bill Passes the House Financial Services Committee but…

The panel approved the bill on a partisan vote of 33 to 27. It was one of 13 bills advanced by the panel…


December 13, 2017 - IMFnews

Short Takes: GSE Dividend Payments: All Systems Go? / Cutting GSE Shareholders out of the Equation? / Wintrust Buying Mortgage Assets from VA Lender / UWM and MC Strike Deal / Chase Exec Bolts for Hamilton

In a new blog posting, Investors Unite asks the basic question: “Are Fannie’s and Freddie’s foes driving GSE reform?”


December 12, 2017 - IMFnews

JPM’s New Non-Agency MBS Chock Full of ‘Agency Eligible’ Loans

The conforming mortgages in the deal were largely originated by correspondent lenders…


December 11, 2017 - IMFnews

The Industry Shows Concern (Once Again) about GSE Technology and Potential Abuses

MBA: Fannie and Freddie should only undertake those activities that support secondary market liquidity…


December 8, 2017 - Inside Nonconforming Markets

Government Guarantee Likely in Reform Effort

Housing-finance reform legislation in Congress will likely include a government guarantee for mortgage securities backed by conventional home loans after a concession this week by Rep. Jeb Hensarling, R-TX. The chairman of the House Financial Services Committee has long pushed to wind down Fannie Mae and Freddie Mac, removing the government guarantee associated with the government-sponsored enterprises. “I continue to believe that a government guarantee in ...


December 8, 2017 - Inside Nonconforming Markets

Conforming Loan Limit Increasing in 2018

The conforming loan limit will increase again in 2018, prompting some pushback from supporters of the non-agency market. The conforming loan limit for one-unit properties in 2018 will be $453,100, up 6.8 percent from the current limit. For high-cost areas, the loan limit will be as high as $679,650 in 2018, up from $636,150 this year. The limits apply to acquisitions of mortgages by Fannie Mae and Freddie Mac, and annual adjustments are based on a house-price index ...


December 8, 2017 - IMFnews

What We’re Hearing: President Trump: Wells Fargo Will be Fined / President Trump? / Time to Exempt Fannie and Freddie from the GOP Tax Overhaul? / Who Lost the GSEs? / Hensarling’s Change of Heart, Why? / CMLA Names Former Freddie Official Acting Director

Now comes the big question: Why is the president of the United States weighing in on a bank regulatory issue? Then again, it’s Donald Trump. Mortgage ramifications? Stay tuned…


December 8, 2017 - IMFnews

Hensarling is Ready to Deal on GSE Reform, but Will it Happen?

Rep. Hensarling: “This means the government needs to be in the last-loss position, with multiple layers of private capital, as diversified as possible, stacked up before it.”


December 8, 2017 - IMFnews

Agency MBS Issuance Up Slightly in November. Another Big Month for Freddie

It was Freddie Mac’s second-largest month of the year...


December 7, 2017 - Inside Mortgage Finance

GSE Technology Pilots and Programs Could Harm Primary Market Activity if Not Careful

The Mortgage Bankers Association has raised concerns that new technology projects at Fannie Mae and Freddie Mac could infringe on the primary market – taboo territory for the two government-sponsored enterprises.


December 7, 2017 - IMFnews

If Rep. Hensarling Gets His Way, GSE Shareholders Would be Wiped Out

If the Texas Republican gets his way, investment firms including Pershing Square and Fairholme Funds stand to lose the millions of dollars…


December 6, 2017 - IMFnews

HFSC Chairman Hensarling Makes it Official – He’s Open to Idea of U.S. Backing Mortgages, but Still Wants to Kill Fannie and Freddie

However, Hensarling is adamant that the plug be pulled on Fannie Mae and Freddie Mac...


December 6, 2017 - IMFnews

Since the Summer, a Sweet Rally for Fannie Mae, Freddie Mac Common. Meaning?

Investor Pershing Square Capital should be happy. The firm owns roughly 9.98 percent of Fannie common and 9.77 percent of Freddie.


December 5, 2017 - IMFnews

Short Takes: When it Comes to GSE Issues, No Lobbying Please / A Large MSR Package Forthcoming? / KBW Ends Coverage of Walter / Newfi Gets Fannie Approvals, FHA / Yes, Cordray is Running for Governor / Redfin Director Departs Suddenly

We understand that a fairly large bulk portfolio of mortgage servicing rights might be hitting the auction block soon...


December 5, 2017 - IMFnews

FHFA Updates CSP Project: $661.6 Billion of Issuance Thus Far for Freddie; A Fear of Price Differentials?

The FHFA said it’s working with Fannie and Freddie to “develop processes to identify and align those enterprise programs, policies, and practices that could materially affect prepayments.”


December 4, 2017 - IMFnews

Short Takes: Atlanta’s Mayor Wants Fannie Chairman Perry to Resign / Arch’s Chief Economist: Housing Relief for Seattle, Looser Credit / LendingHome Hits $2B Mark / Senators Make Threats Regarding English / A Promotion at LoanLogics

Nine senators said they would work to invalidate any new rules issued by the CFPB if Leandra English prevails in her attempts to unseat and replace the bureau’s acting director, Mick Mulvaney...


December 4, 2017 - IMFnews

As ‘Zero Capital’ Day Approaches, Senate Moves to Create a GSE Bill

Lobbyists and others tracking the effort told this newsletter that those who’ve been shown the legislative language have taken a non-disclosure vow…


December 4, 2017 - IMFnews

3Q17 Mortgage Buyback Activity Higher at Freddie, Lower at Fannie

GSE buyback activity has trended lower over the past two years…


December 1, 2017 - Inside The GSEs

GSE Roundup

Think Tank Makes a Case for GSEs to Become SIFIs. Alex Pollock, senior fellow at the R Street Institute, along with author Thomas Stanton, wrote Treasury Secretary Steve Mnuchin this week urging him to designate Fannie Mae and Freddie Mac as Systemically Important Financial Institutions (SIFIs). They said that it’s obvious the mortgage giants meet all the criteria specified by the Dodd-Frank Act and the Financial Stability Board for designation as SIFIs and they want the same protective capital and regulatory standards applied to the...


December 1, 2017 - Inside The GSEs

Fannie CEO Said More Confidence Needed in Housing Market

Fannie Mae CEO Tim Mayopoulos said the housing crisis has made people cautious about buying a home and that confidence in the market needs to be restored. Speaking at the Detroit Economic Club last week, Mayopoulos emphasized the need for affordable housing, calling the issue “urgent.” More than one million starter homes have been lost since the crisis, according to Mayopoulos. He pointed out that from 2012 and 2015, the most affordable one-third of homes rose 38 percent in price, and the inventory dropped by 39 percent. In addition to the decline in the number of affordable homes, he said people aren’t as comfortable in making a home purchase as they were before the crisis.


December 1, 2017 - Inside The GSEs

7th Circuit Rules Local Taxes Apply To Investors in GSE Properties

The Seventh Circuit Court recently reversed an earlier decision that held buyers purchasing property in Chicago from Fannie Mae were liable for state and local transfer taxes. The case involved real property transfer taxes imposed in 2013 and 2014 on purchasers who argued they were legally exempt from having to pay. The Illinois Department of Finance assessed the buyers for the tax. But since the property was purchased from a federal agency, the buyers believed they were exempt from having to pay. The buyers and Fannie then both sued the City of Chicago and asked the federal court to review the finance department’s decision.


December 1, 2017 - Inside The GSEs

Lender Front-End Transactions Account for Small Share of CRTs

During the second quarter of 2017, Fannie Mae and Freddie Mac transferred credit risk on $12.6 billion of unpaid principal balance loans through front-end lender risk sharing, according to the Federal Housing Finance Agency’s latest credit-risk transfer progress report. While the GSEs have plans to grow front-end deals, they currently represent a small portion of the total $212.8 billion risk transferred during the second quarter. Lender risk sharing lets lenders invest directly in credit risk by retaining a portion of the credit risk on loans they originate or service. Lender risk sharing accounted for 5 percent of the GSEs’ $6.4 billion risk in force.


December 1, 2017 - Inside The GSEs

Federal Home Loan Bank Advances Continue to Climb in Third Quarter

Banks and thrifts reported holding $575.4 billion of Federal Home Loan Bank advances at the end of September, a quarterly increase of 1.7 percent and the largest volume of advances in the past 12 months, according to an analysis by Inside The GSEs. That number is also well above the number of advances that were made in the third quarter of 2016. Year-over-year, third quarter advances were 6.2 percent higher than the $541.8 billion reported a year earlier. While JPMorgan Chase remains in the number one spot with $63.8 billion in advances, that was down 6.9 percent from $68.5 in the second quarter, and 19.8 percent below the level a year ago.


December 1, 2017 - Inside The GSEs

FCC Seeks Comment Regarding FHFA’s TCPA Petition

The Federal Communications Commission is seeking feedback on a petition filed by the Federal Housing Finance Agency regarding the ability of mortgage servicers to contact borrowers in natural disaster areas. The FHFA petition is in reference to stipulations based on the Telephone Consumer Protection Act. With three major hurricanes this fall, the FHFA said there’s a need for mortgage servicers to quickly contact borrowers whether by voice or automated messages. The agency filed the petition in hopes of getting a speedy response to two requests. The Fannie Mae and Freddie Mac regulator wants the FCC to declare that borrowers who are affected by disasters are considered to have given their consent to receive calls from their mortgage servicers.


December 1, 2017 - Inside Mortgage Trends

GSEs Report Progress on eMortgage Processes

Fannie Mae and Freddie Mac say they have made significant strides over the past year to address obstacles to the transition to a fully digital mortgage process that have been identified by mortgage lenders and other industry participants.


December 1, 2017 - Inside The GSEs

Fannie Board Chair Defends Against ATL Mayor Land Claims

Fannie Mae’s board chairman and the mayor of Atlanta are in a heated dispute over roughly 100 acres of vacant land that the city said was supposed to serve the low-income population. In fact, Mayor Kasim Reed is suing Egbert Perry and has asked him to step down from his position as non-executive chairman of Fannie’s board. Perry, co-founder and CEO of the Integral Group, joined the GSE’s board in late 2008, and has been chair since 2014. He says he hasn’t done anything wrong. The argument stems from what the mayor calls a “secret deal” made with Integral in 2011 by Renee Glover, the former president and CEO of the Atlanta Housing Authority, who now serves on Fannie’s board.


December 1, 2017 - Inside The GSEs

KBW, IU Weigh in On Corporate Tax Reduction Impact on DTAs

If Congress succeeds in cutting the corporate tax rate next year, the GSEs would have to write down their deferred tax assets by somewhere between $13 and $19 billion or face having to take a draw from the Treasury, according to estimates from Keefe, Bruyette & Woods. The House Republican tax reform plan proposes to lower the corporate tax rate from 35 percent to 20 percent. It would be the largest reduction in the corporate rate in the nation’s history. But KBW also said having to take a draw because of the DTA write-down may not be that big of a deal.


December 1, 2017 - Inside The GSEs

Multifamily Lending Caps Lowered For 2018, Originations Slowing

In anticipation of a slight decline in multifamily mortgage originations, the Federal Housing Finance Agency last week lowered the multifamily lending caps for Fannie Mae and Freddie Mac in 2018. GSE multifamily business will be capped at $35.0 billion, down from the $36.5 billion level it’s been the past two years. FHFA analyzes the multifamily loan origination market size each quarter to decide if it will adjust the GSEs’ purchase limits. In the event the market picks up in 2018, the agency could raise the cap. And if the market slows even more than expected, it could lower the caps further.


December 1, 2017 - Inside The GSEs

FHFA Raises Baseline Conforming Loan Limit to $453,100

The Federal Housing Finance Agency raised the baseline conforming loan limit for GSE mortgages by $29,000 for next year. The new loan limit, announced Nov. 28, is $453,100, and represents just the second time since the 2007 housing downturn that the conforming loan limit has been raised. For 2017, it was increased by $7,100, to $424,100. The baseline loan limit was established by the Housing and Economic Recovery Act of 2008 and is closely reviewed each year to reflect any changes in the national home price index. In determining maximum loan amount under the terms of HERA, FHFA uses the expanded-data home price index. The expanded-data HPI increased 6.8 percent between the third quarters of 2016 and 2017.


December 1, 2017 - Inside The GSEs

Yearend May Have Industry, Trump Admin Scrambling for a Solution

As the end of the year nears, there’s been talk this week about negotiations underway between the Federal Housing Finance Agency and the Trump administration to address the capital situation at Fannie Mae and Freddie Mac. Although no one is confirming the discussion, a Bloomberg report quoted an anonymous source as saying that FHFA officials want Fannie and Freddie each to keep a capital buffer of $2 billion to $3 billion on their books. In return, the report said, the administration wants to limit the GSEs’ activity in the market by tightening restrictions on the type of loans they buy. In late 2013, former FHFA Acting Director Ed DeMarco proposed implementing a loan size limit on...


December 1, 2017 - Inside The GSEs

As ‘Zero Capital’ Day Approaches, Senate Moves to Create a GSE Bill

In roughly 30 days, Fannie Mae and Freddie Mac will see their capital buffers fall to zero, an event that has GOP legislators working feverishly over the past several weeks to come up with housing-finance reform legislation. In short, Republicans fear that in the event of a quarterly loss by one or both GSEs next year, these massive mortgage giants might need to tap a line of credit they have with the U.S. Treasury, which would result in another “taxpayer bailout” of the two. And since Republicans are in charge of both chambers of Congress, as well as the White House, they would get blamed. At least that’s how the situation was explained to Inside The GSEs.


December 1, 2017 - Inside The GSEs

Buyback Activity Jumps Higher At Freddie, Slows at Fannie

A tiny portion of loans sold into Fannie Mae and Freddie Mac mortgage-backed securities trigger a buyback demand from either of the GSEs, and in most cases lenders are able to avoid an actual repurchase or indemnification. Lenders repurchased or provided other indemnification for $260.12 million of home loans during the third quarter of 2017, a 6.4 percent increase from the prior period, according to an Inside The GSEs analysis of quarterly disclosures made to the Securities and Exchange Commission. During the same period, Fannie and Freddie issued $223.6 billion of new single-family MBS. The third-quarter spike in buyback activity came all on the Freddie side of the market.


December 1, 2017 - IMFnews

What We’re Hearing: Yes, There’s a Senate GSE Reform Bill in the Works / Acting Ginnie Mae President Has Some MBS Ideas / How Many Loss Positions are There? / The Mulvaney Effect? / Ranieri will Stick Around

Mick Mulvaney has been in charge of the CFPB all week and we’ve yet to hear one prediction that subprime mortgage lending will revive with a vengeance…


December 1, 2017 - Inside MBS & ABS

GSE and Ginnie Mae Counterparties Could Get Hammered by MSR Language in GOP Tax Bill

Language in the pending Senate tax bill that could hammer the value of mortgage servicing rights is causing grave concern in the industry and, if the wording remains, nonbank mortgage firms could get hammered financially.


December 1, 2017 - IMFnews

Conforming-Jumbo Market Grew Faster Than Non-Agency Sector in 3Q17

Roughly $119.1 billion of mortgages that exceed the conforming loan limit of $424,100 were produced during the third quarter of 2017…


November 30, 2017 - IMFnews

Acting Ginnie Mae President Michael Bright Makes His Pitch to Have Ginnie be the Big Kahuna of Government MBS

Industry lobbyists believe one key legislator in favor of the Ginnie concept is House Financial Services Committee chairman Jeb Hensarling, R-TX…


November 29, 2017 - IMFnews

Short Takes: Watt and Treasury, is there a Deal? / GSE MBS Investors May Want More Yield / FGMC Cuts Staff / PIMCO, the Owner / Senate Banking Clears Montgomery for the FHA Job

Come Jan. 1, rates may spike thanks to zero GSE capital...


November 28, 2017 - IMFnews

Fannie/Freddie Loan Limit for 2018 Increases by 6.8 Percent to $453,100. High-Cost Limit Hits $679,650

In high-cost areas, the GSE loan limit will increase to $679,650...


November 22, 2017 - Inside MBS & ABS

Fannie, Freddie Ready to Return to Multifamily Tax-Credit Market After 10-Year Absence

Fannie Mae and Freddie Mac have been approved to once again participate in the low income housing tax credit program aimed at affordable rental housing, but their share will be limited as to not impede on the private market.


November 21, 2017 - IMFnews

A 40-Page GSE ‘Draft’ Bill is Circulating in the Senate

As press time, details were sketchy, but lobbyists who claim to have knowledge of the draft caution there are several “different pieces” to the measure...


November 20, 2017 - IMFnews

GSE Sellers Take Baby Steps on Risk – but at a Glacial Pace

This most-risky bucket accounted for just 2.6 percent of refi business in the third quarter...


November 20, 2017 - IMFnews

A Strong October for Freddie, GSE Takes Market Share from Fannie

Freddie officials stated that the GSE continued to incur market-adjusted pricing costs in the form of lower MBS guarantee fees.


November 17, 2017 - Inside The GSEs

GSE Roundup

Fannie Prices $1.2B CAS Deal. Fannie priced its seventh credit risk-sharing transaction of 2017 under its Connecticut Avenue Securities program. CAS Series 2017-C07, a $1.161 billion note offering, is scheduled to settle on Nov. 21, 2017, and is the final deal of the year. It was met with strong investor demand, including new investors, according to Laurel Davis, Fannie’s vice president of credit risk transfer. “Investors continue to provide us with positive feedback on the transparency we provide as part of our CAS program, including our response to recent hurricane events and the information we make available in Data Dynamics, our analytical tool for investors. We expect to continue regular benchmark issuance of CAS notes in 2018, subject as always to market conditions.”


November 17, 2017 - Inside The GSEs

Fed Reserve Council Suggests GSE Reform Include Home Counseling

The Federal Reserve Board’s Community Advisory Council and the Board of Governors said the current mortgage finance system doesn’t provide fair access to large segments of the population. They also noted that there’s a critical need to resolve the ongoing conservatorship. Members of the two groups held their semiannual joint meeting earlier this month and discussed the need to reform the housing finance market so that low to -moderate income borrowers aren’t left out. The council talked about the need to disaggregate economic data to understand the disparities that exist in mortgage lending, especially among minority groups.


November 17, 2017 - Inside The GSEs

OIG Lists 2018 Management, Performance Challenges for FHFA

The Federal Housing Finance Agency Office of the Inspector General said the FHFA needs to focus on improving its oversight of the GSEs and Federal Home Loan Banks in several key areas. In fact, the FHFA faces four “serious” management and performance challenges that carried over from prior years, according to a recently published OIG memo to FHFA Director Mel Watt. The OIG is troubled by the agency’s supervision of the GSEs and said it needs to improve oversight of matters delegated to Fannie Mae and Freddie Mac, as well as make its internal review process for non-delegated matters stronger.


November 17, 2017 - Inside The GSEs

Fannie’s Servicing Marketplace Set to Open in December

Fannie Mae’s Servicing Marketplace that connects servicers and sellers during transfers, is expected to be up and running shortly after Thanksgiving. In a recent servicing guide update, the GSE noted that certain loans delivered under whole loan servicing released commitments taken on or after Dec. 4, 2017, will be bifurcated if sellers participate in its servicing execution tool or the Servicing Marketplace.The mortgage giant designed the application to simplify and bring new concurrent transfers of servicing options to customers. Fannie noted that it also hopes to provide certainty of sale, execution, and process efficiency. Lenders must be approved to participate in the servicing marketplace.


November 17, 2017 - Inside The GSEs

Fannie, Freddie Make Strides to Strengthen eMortgage Adoption

Fannie Mae and Freddie Mac released a report this week on efforts to improve the origination of eMortgage transactions including more education and policy alignment on the topic. Those efforts have resulted in the growth of the number of warehouse banks that fund eNotes. The report was a follow-up to a joint industry outreach survey the GSEs conducted last year on perceived barriers to the industry adopting eMortgages. Stakeholder readiness and process complexity were found to be the most common barriers among the lenders, IT companies, warehouse banks, servicers and title/settlement providers surveyed. Survey participants said there was a lack of support for funding eNotes by warehouse banks, a source many mortgage lenders rely on.


November 17, 2017 - Inside The GSEs

Fannie Exploring Construction Lending to Help Affordability

Fannie Mae is looking to give homebuyers access to easier and more affordable construction loans through a potential new pilot program. As the housing supply shortage continues and affordability remains a critical barrier for first-time homebuyers, Fannie envisions the program as a path for homebuyers to get affordable housing. Not many details have been released and there’s no set timeframe because the program is just in the beginning stages of consideration. But if the GSE gets the green light from the Federal Housing Finance Agency, Fannie will be able to buy the loans as soon as construction begins instead of before the house is finished.


Poll

With originations expected to drop in 2018, will your shop turn to non-QM/non-prime mortgage products as a way to bolster volumes?

Yes, definitely. We’re planning a launch.

33%

No. It’s still difficult compliance/regulatory-wise.

20%

Maybe. It’s under consideration.

33%

Not now. But things could change as 2018 progresses.

13%