Lowering Fannie Mae and Freddie Mac loan limits is one of the easiest levers the federal government could pull to increase non-agency participation in the mortgage market but most market participants favor keeping them at their current levels. In December, the Federal Housing Finance Agency announced that it was considering reducing the loan “purchase limits” for the government-sponsored enterprises. Under the plan, the GSEs could not purchase loans exceeding ...
The private equity plaintiffs allege that the Treasury’s change in the dividend structure of its preferred stock leaves the GSEs with no funds to pay anything to junior shareholders.
Agreeing to speak only on background, some mortgage participants thought that ORI’s recapitalization plan raised serious concerns among potential investors.
The serious delinquency rate on servicer portfolios hasn’t improved much in the past year, from 5.7 percent in the fourth quarter of 2012 to 5.4 percent in the fourth quarter of 2013.
With just one accord this week, the Federal Housing Finance Agency more than doubled the amount it has recovered on behalf of Fannie Mae and Freddie Mac from issuers and underwriters that sold subprime and Alt A MBS to the government-sponsored enterprises. Bank of America agreed to a $9.3 billion settlement that covers its own dealings as well as those of Countrywide Financial and Merrill Lynch, which it acquired in 2008. The agreement covers some $57 billion of MBS issued or underwritten by these firms. BofA did not admit...[Includes one data chart]
It’s too soon to reduce agency loan limits, according to numerous trade groups involved in the securitization and mortgage origination markets. Momentum in Congress also appears to be moving toward maintaining the high-cost loan limits, a category of loans that was created in 2008 on an “emergency” basis. In December, the Federal Housing Finance Agency issued a request for input on a proposal to set loan purchase limits for Fannie Mae and Freddie Mac. Ed DeMarco, the FHFA’s acting director at the time, was considering reducing the loan amount eligible for purchase by the government-sponsored enterprises from $625,500 in high-cost areas to $600,000 and reducing the national loan purchase limit for the GSEs from $417,000 to $400,000. DeMarco said...
Rep. Maxine Waters, D-CA, this week unveiled a mortgage-finance reform bill that would replace Fannie Mae and Freddie Mac with a private cooperatively-owned entity that would issue a new form of conventional MBS backed by a mix of public and government credit support. The “Housing Opportunities Move the Economy Forward Act” adds a few new twists to the notion of creating an explicit government MBS guaranty that would stand behind a first-loss position funded by the private sector. Rather than allow a variety of private-sector firms to issue these securities, as the bipartisan Senate bill would, Waters’ proposal would create a single, cooperatively-owned entity that would be open to all lenders. The regulator of this new market, the National Mortgage Finance Administration, would have...
Colony American Homes has come to market with a $513.6 million security backed by single-family rental homes, but some players in the space are starting to wonder if the returns on the bond will be anything special. Moody’s Investors Service and Kroll Bond Rating Agency rated the deal, which marks the second SFR securitization in four months. The other was a $479 million deal from Deutsche Bank and the Blackstone Group, which turned out to be oversubscribed. KBRA’s ratings on the Colony bond range...
Fannie Mae this week released its STAR servicer rankings and hopefully a copy found its way to all those pesky regulators who think nonbank servicers can’t tell the difference between a debit and a credit.
Bipartisan mortgage-reform legislation under consideration in the Senate could open significant opportunities for firms currently involved in the non-agency market, according to industry analysts. Firms with jumbo conduit operations and real estate investment trusts that invest in non-agency mortgage-backed securities could see their potential markets increase significantly under the proposed system. Sens. Tim Johnson, D-SD, and Mike Crapo, R-ID, have proposed a ...