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Inside The GSEs

May 6, 2009

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Industry Proposes Innovative GSE Model

The mortgage industry continues to brainstorm over the forms that Fannie Mae and Freddie Mac might assume in a post-conservatorship world – and more flesh is appearing on the bare-bones concepts that began circulating last year. Perhaps the most interesting and substantive of the proposals discussed thus far came from the Consumer Mortgage Coalition. The CMC recently called upon Congress... Read More

FHLB Securitization Isn’t a Slam Dunk

A majority of commenters support the notion of granting the Federal Home Loan Banks the authority to securitize mortgages. But others suggested it might only be appropriate in limited circumstances, while others flat-out oppose it. The Federal Housing Finance Agency in February asked for public input as it prepares to launch a study on the securitization of conforming... Read More

Affordability Advocate Laments Weaker GSE Goals

Last week, the Federal Housing Finance Agency released a proposed rule that would ratchet down the GSEs’ affordable housing goals to 2004-2006 levels, a move that “might be devastating to the economy,” according to National Association of Affordable Housing Lenders President and CEO Judy Kennedy. “The liquidity crisis confronting responsible lenders, both banks and nonprofits, is huge... Read More

FHLBank MBS Holdings Slid 2.3% in Fourth Quarter

The Federal Home Loan Banks, as a group, were bigger sellers of mortgage-backed securities than they were buyers during the fourth quarter, with overall MBS holdings off 2.3 percent from third quarter levels. Most of the drop came from holdings of the now much-maligned non-agency MBS, which fell 6 percent from the previous period. Deterioration in the... [Includes one chart] Read More

GSEs and Jumbos: Not Living Up to Their Potential

When Fannie Mae and Freddie Mac were finally given the authority to get into the jumbo mortgage space after years of lobbying, company officials, shareholders and GSE supporters were excited about the possibilities of a huge potential increase in their business. But in the intervening months, neither GSE has been able to fully exploit the hard-won concession. Several factors have... Read More

GSEs Provide More Details on Loan Mod Efforts

Officials at Fannie Mae and Freddie Mac recently elaborated on the roles they are playing and how they can work together with lenders to support the Obama administration’s housing rescue initiatives via the loan modification program, which is designed to respond to borrowers that can’t qualify for the refinance aspect of the program.“Both agencies intend that the refinance [option] is the first... Read More

Federal Support of the GSEs Exceeds $660 Billion

The U.S. government’s support of Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks has now reached at least $660.21 billion through early May, all part of the larger federal plan to bolster the overall U.S. housing market and help thaw out the freeze in residential mortgage finance. So far, the Federal Reserve Bank of New York, which has been administering... Read More

MI Woes May Present Painful Choices to GSEs

The problems besetting the private mortgage insurance industry might force some uncomfortable realities upon Fannie Mae and Freddie Mac, particularly if the MIs aren’t able to arrange access to some federal financial rescue funds. This possibility was vividly evoked when Genworth Financial, the holding company, recently said it won’t be accessing the Troubled Asset Relief Program, cutting off one... Read More

GSEs Incented to Take Huge Losses by Year’s End

The clock is already ticking on Uncle Sam’s GSE rescue package, with the Treasury’s credit facility and MBS purchase program for the GSEs both set to expire on Dec. 31. That’s prompting some analysts and observers to predict that Fannie Mae and Freddie Mac will accelerate their recognition of losses and increase their reserves, given their incentives to maximize the... Read More

News In Brief

Kellermann Death Highlights Investigations of Freddie.... Moffett to Return to Freddie, Filling Kellermann’s Void... NYSE Delisting Threat for Fannie, Freddie Won’t Apply Until August... Fannie Names New Executives... Read More

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