The majority of mortgage industry professionals said they believed that the lowering of the down payment to 3 percent for first-time homebuyers by Fannie Mae and Freddie Mac was a step in the right direction for the housing market, according to the Collingwood Group's November 2014 Mortgage Industry Outlook Report. In a survey conducted online distributed to a diverse group of mortgage and housing industry professionals, 69 percent of respondents said that lowering the down payment was a move in the right direction for housing.
The survey respondents who believed lowering the down payment was a positive move said it reflected concern of policymakers with current market dynamics, and it indicated a willingness on the part of the Federal Housing Finance Agency to ease lending standards. At the same time, most respondents pointed out the existence of other high loan-to-value products and said they believed the Federal Housing Administration offered the best option.
Fannie Mae has expanded its risk sharing offerings with Wednesday's announcement of the credit insurance risk transfer deal, which transfers the credit risk on a pool of loans from taxpayers to a panel of domestic reinsurers. The goal of the new deal is to reduce the risk to taxpayers by increasing the role of private capital in the mortgage market. The new deal also fulfills one of the 2014 Conservatorship Scorecard goals, which was to complete a variety of risk sharing transactions in addition to the Connecticut Avenue Securities series announced by Fannie Mae in October 2013.