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Tag Archives: Freddie Mac

Freddie: Refinancing Homeowners Prefer Fixed-Rate Loans

More homeowners and mortgage borrowers who chose to refinance their loans opted for the fixed-rate loan instead of adjustable-rate mortgages over the second quarter this year, according to a Freddie Mac quarterly report released Monday. The GSE held that some 37 percent of borrowers refinancing their mortgages moved forward with 15- and 20-year loans. Refinancing borrowers nodded toward these fixed-rate loans in increasing numbers, according to the report.

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BofA Sells Mortgage Rights to Fannie Mae

In an endeavor to get ahead of mortgage-related woes from the financial crisis, mortgage giant Bank of America has offered to sell a chunk of its mortgage portfolio servicing rights to GSE Fannie Mae, according to the Wall Street Journal. The sale of bad loan rights to the government entity may shift new bulk onto federal balance sheets at a time when the GSE recently posted second-quarter losses and announced plans to petition the government for more taxpayer funds.

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Investors Rush to Scoop Up GSE Mortgage Debt

While Treasury yields plummeted on low notes sounded by investors over panicked markets, recently downgraded GSEs Fannie Mae and Freddie Mac continue to see spikes in interest from investors over their mortgage-backed debt. The Financial Times attributes the investor rush to the market bonanza created by the Federal Reserve, which decided Tuesday to keep interest rates at historically low levels until 2013. Some analysts say the investor rush to agency debt could crimp financing for U.S. federal debt and potentially frustrate mortgage rates.

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Markets Squeeze Banks, Homebuilding Companies

The Dow Jones Industrial Average swept clean Tuesday's historic gains with a 519.83-point nosedive Wednesday, reflecting widespread fears about contagious European debt, the impact of Standard & Poor's downgrades, and an economic slowdown worldwide. Signaling further distress for housing markets, banks with thick mortgage portfolios and homebuilding companies saw their stocks tumble in an investor stampede for the exits. Following the Dow closely, the Nasdaq and S&P 500 plunged 101.47 points and 51.77 points, respectively.

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Stocks Surge After Fed Decides to Keep Interest Rates Low

Fed

Citing recent trouble on Wall Street, anemic job growth, and lags in the housing economy, the Federal Reserve made public that it will keep interest rates at historically low levels until 2013. The new language marks a market-rallying policy shift for the central bank, which previously kept mum about when it would hike up interest rates. A 429-point jump by the Dow followed a Federal Open Market Committee meeting in which the Fed's decision-makers reportedly failed to reach a consensus on interest rates.

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What the GSE Downgrades Mean for Housing Markets

Standard & Poor├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós continued a bold streak it started Saturday by deflating debt credit ratings for mortgage giants Fannie Mae and Freddie Mac Monday, scaring investors and adding velocity to the Dow's 630-point plunge.

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Markets Shake with GSE, Home Loan Bank Downgrades

Freddie

Standard & Poor├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós sent markets into a tailspin Monday when it downgraded credit ratings on debt for mortgage giants Fannie Mae and Freddie Mac, citing majority ownership by the federal government, whose own ratings the agency pulled down to AA+. Showing no remorse, the ratings agency also downgraded debt ratings for 10 Federal Home Loan Banks across the country. The dual downgrades represented a vote of no confidence by S&P that helped create selloff frenzy on Wall Street.

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Treasuries, Analysts Respond to U.S. Debt Downgrade

Markets and investors recoiled Saturday over news that ratings agency Standard & Poor's slapped U.S. Treasury debt with a downgrade, shifting credit ratings for the world's largest economy from the long-prized AAA rating to a weaker AA+ rating. In response, Treasury yields dipped over Monday, as housing analysts suggested that the hyped downgrade would hurt borrower confidence more than mortgage rates. Rather than run, investors bought up Treasuries Monday.

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BAC Going after GSE Practices

The government sponsored enterprises are feeling the heat from Bank of America. A recent filing from BAC targets Fannie Mae and Freddie Mac, stating that the criteria by which the GSEs are ultimately willing to resolve claims have become more rigid over time. By the numbers, BAC sold an estimated $1.1 trillion in mortgage loans to Fannie and Freddie between 2004 and 2008, and during the second quarter of this year, approximately $121 billion of the GSE-owned loans were in default or more than 180 days in arrears.

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