Freddie told homeowners that, in addition to the traditional disaster relief options provided by the GSEs, they may be eligible for relief through COVID-related forbearance programs.
There’s plenty of evidence that housing isn’t as healthy as it appears. The most important data point is probably the increase in the rate of serious mortgage delinquencies, which reached 4.4% in the second quarter, the highest level since 2014.
MBA also urged the regulator to create guardrails to prevent any individual shareholder from gaining control of Fannie and Freddie after they’ve exited conservatorship…
Fannie Mae’s credit-risk transfer loan-level data show 21.0% of borrowers that were in forbearance in June exited when their relief plans expired in July. That works out to 1.7% of the government-sponsored enterprise’s outstandings.
The MBA said a permanent, paid-for government backstop for agency mortgage-backed securities would be the ideal way to ensure a deep, liquid secondary mortgage market.
More importantly, the analyst noted, the council threatened to impose still stricter standards or designate the GSEs as systemically important financial institutions if the capital rule was materially softened.