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Freddie Mac Loans on Track for Big Annual Increase

Mortgage IndustryThe latest monthly volume report from Freddie Mac found a growing mortgage portfolio and a declining level of single-family delinquencies.

Freddie Mac reported that its entire mortgage portfolio totaled $137.2 billion in October, an annualized rate of 25.7%. One year ago, the portfolio totaled $51.1 billion.

The single-family refinance-loan purchase and guarantee volume in October was $89.7 billion, which accounted for 71% of total single-family mortgage portfolio purchases and issuances. The aggregate unpaid principal balance of Freddie Mac’s mortgage-related investments portfolio decreased by approximately $6.7 billion in October.

The government-sponsored enterprise also reported that its single-family delinquency rate dropped from 3.04% in September to 2.89% in October while its multifamily delinquency rate inched up slightly from 0.13% in September to 0.14% in October. One year earlier, the single-family delinquency rate was 0.61% and the multifamily delinquency rate was 0.05%.

Freddie Mac’s mortgage-related securities and other mortgage-related guarantees increased at an annualized rate of 26.1% in October, with an ending balance of $2.52 billion. In October 2019, by comparison, mortgage-related securities and other mortgage-related guarantees increased at an annualized rate of 5.8%, with an ending balance of $2.2 billion.

October marks the start of the fourth quarter, and Freddie Mac is coming off a third-quarter where it recorded $2.5 billion in third-quarter net income, up from $1.77 billion in the second quarter and up from $1.70 billion in the third quarter of 2019, as well as $2.4 billion in comprehensive income, up from $1.9 billion in the previous quarter and up from $1.8 billion one year earlier.

Freddie Mac reported $337 billion in new single-family business activity in the third quarter, a 45% increase from the previous quarter, while its new multifamily business activity declined to $18 billion, down 10% from the prior quarter. On a year-over-year measurement, Freddie Mac’s single-family and multifamily guarantee portfolios grew 11% and 14%, respectively.

About Author: Phil Hall

Phil Hall is a former United Nations-based reporter for Fairchild Broadcast News, the author of nine books, the host of the award-winning SoundCloud podcast "The Online Movie Show," co-host of the award-winning WAPJ-FM talk show "Nutmeg Chatter" and a writer with credits in The New York Times, New York Daily News, Hartford Courant, Wired, The Hill's Congress Blog and Profit Confidential. His real estate finance writing has been published in the ABA Banking Journal, Secondary Marketing Executive, Servicing Management, MortgageOrb, Progress in Lending, National Mortgage Professional, Mortgage Professional America, Canadian Mortgage Professional, Mortgage Professional News, Mortgage Broker News and HousingWire.
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