Fannie Mae’s gross mortgage portfolio experienced a second month of contraction after a rare increase in August, according to Fannie Mae's September 2016 Monthly Volume Summary. During the month of October, the GSE’s gross mortgage portfolio condensed by 20.1 percent. This contraction keeps the GSE below its 2016 cap of $339.3 billion, reached in March.
Fannie Mae also reports that the conventional serious delinquency rate decreased three basis point to 1.21 percent. The GSE also reports that 5,758 loan modifications were completed in October, a dip from August’s 6,355.
The 16.3 percent rate of contraction is another step in the right direction for Fannie Mae. With this decrease, the aggregate unpaid principal balance (UPB) of Fannie Mae’s gross mortgage portfolio was $300.86 billion at the end of the month—down by about $5.68 billion from August, according to Fannie Mae. The portfolio has declined at an annual rate of 15.2 percent over the past ten months of 2016.
Fannie Mae's total book of business, which includes the gross mortgage portfolio plus total Fannie Mae mortgage-backed securities and other guarantees minus Fannie Mae MBS in the portfolio, increased at a compound annualized rate of 2.5 percent in September up to a value of about $3.129 trillion.
In January 2016, Fannie Mae’s gross mortgage portfolio experienced a rare expansion, increasing at an annual rate of 5 percent. With August’s increase, the portfolio has now seen this rarity twice this year as well as in five months since June 2010. The four months prior to August in which the portfolio expanded were January 2016, March 2015, January 2015, and December 2012. At the beginning of that stretch in June 2010, the amount of unpaid principal balance (UPB) of the loans in the portfolio was $818 billion.