The Federal Housing Finance Agency (FHFA) recently issued an update to mortgage-backed security (MBS) structure, also known as Single Security. The new changes to the Single Security structure are based on 23 responses to a “Request for Public Input: Proposed Single Security Structure (RFI)” released in August 2014 by the FHFA.
Read More »Nomura Found Liable For Selling Toxic Mortgage-Backed Securities to GSEs
The nearly two-month long court battle between the Federal Housing Finance Agency (FHFA) and Nomura Holdings came to an end Monday when a federal judge found the bank liable for selling shoddy mortgages to Fannie Mae and Freddie Mac prior to the 2008 financial crisis.
Read More »Fannie Mae Reports Net Income of $1.9 Billion
Fannie Mae reported a net income of $1.9 billion for the first quarter of 2015, up from $1.3 billion from the previous quarter, according to Fannie Mae's Q1 2015 financial results released Thursday. The primary driver of the nearly 50 percent quarter-over-quarter increase in net income was lower fair value losses for Q1, according to Fannie Mae's announcement.
Read More »Congressman to Introduce Bill to Prevent Pay Increase for CEOs of GSEs
U.S. Congressman Ed Royce (R-California) has announced that he plans to submit legislation by the end of the week to prevent a potential pay increase for Freddie Mac CEO Donald Layton. The Federal Housing Finance Agency (FHFA) has given Freddie Mac and its fellow GSE, Fannie Mae, authorization to review the salaries of their respective CEOs, Layton and Timothy Mayopoulos. Both CEOs made $600,000 each without bonuses in 2014. The pay reviews for the top executives at the GSEs are largely due to concerns that the Enterprises will not be able to stay competitive because their CEOs make less than some lower-ranked executives.
Read More »FHFA’s Conservatorship of GSEs Has No Clear End, Ratings Company Says
Since 2012, all GSE profits have been swept into Treasury. The GSEs each have a capital buffer of $1.8 billion, but it is required to be reduced by $600 million per year until it reaches zero by 2018. The Enterprises would require another draw on Treasury should their losses exceed their capital buffer.
Read More »Stress Test Shows GSEs Would Require Another Sizable Draw on Treasury
The fact that the Enterprises remain in conservatorship of the FHFA has been a contentious topic among lawmakers and housing industry stakeholders in recent months. Fannie Mae and Freddie Mac returned to profitability in 2012, but those profits declined substantially from 2013 to 2014. Recent reports, including one from the FHFA Inspector General, have warned that the profitability of the GSEs might not continue even though the conservatorship probably will.
Read More »Lenders Believe Industry Changes Will Benefit Buyers More than Originators
Though they’re on the fence about the benefits for themselves, most lenders surveyed agreed that both changes would be advantageous to consumers. In fact, 76 percent believe that expanding 97-percent LTV loan products will be good for homebuyers, and another 81 percent believe the MIP reduction will be beneficial, too.
Read More »Insurance Providers Are Currently Compliant With Enhanced PMI Eligibility Requirements
Several leading mortgage insurance providers for the industry have announced that if the enhanced Private Mortgage Insurer Eligibility Requirements (PMIERs) announced by the Federal Housing Finance Agency (FHFA) went into effect today, they would be in complete compliance.
Read More »Treasury Says GSEs Have an ‘Ongoing Financial Commitment’ to Taxpayers
In the response letter, dated April 21, 2015, Treasury's Acting Assistant Secretary for Legislative Affairs, Randall DeValk said that wanted to "clarify some misunderstandings" from some press reports regarding the agreement, and said that the government's $187.5 billion bailout of Fannie Mae and Freddie Mac with taxpayer funds in 2008 was not an "ordinary" loan.
Read More »Fannie Mae Expands Its Assessment Software
Fannie Mae’s software upgrade is part of an effort it’s been rolling out since the beginning of the year. The GSE introduced Collateral Underwriter to the market in January and has nearly 800 lenders registered as users already, according to the Monday announcement. For some, the new system makes immediate and obvious sense.
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