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Tag Archives: FHFA

Fannie and Freddie Detail New HARP Guidelines

Fannie Mae and Freddie Mac have released highly anticipated guidelines for the revised Home Affordable Refinance Program (HARP). Among the key program revisions, the GSEs have eliminated or raised the loan-to-value cap, and relaxed representation and warranty stipulations. Both government officials and market analysts have said rep and warranty waivers could spark heated competition among lenders to refinance borrowers through HARP. With the new guidelines, the GSEs laid out exactly what will be waived.

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House Committee Votes to Suspend Bonus Pay for GSE Execs

The House Financial Services Committee voted in favor of a bill Tuesday that would prohibit Fannie Mae and Freddie Mac from paying out future bonuses and suspend the 2011 compensation packages that have been approved by their regulator. The bill passed the committee by a vote of 52 to 4 and now moves to the full House for consideration. On the other side of Capitol Hill the very same day, the Senate Banking Committee held a hearing in which members grilled the GSEs' regulator about executive pay.

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Senate Proposal Calls for Winding Down of GSEs

Sen. Bob Corker of Tennessee has introduced a bill aimed at winding down the GSEs and bringing uniform standards to the industry. Coker's proposal would gradually reduce the amount of new mortgage backed securities (MBS) issued by Fannie Mae and Freddie Mac over 10 years. At the end of the 10-year period, the MBS market would be completely private. The bill also mandates sales of the GSEs' technology and other systems to private investors, and calls for a replacement to the MERS registry system.

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House Set to Vote on Bill to Suspend GSE Pay Packages

Lawmakers are outraged at the amount of bonus pay awarded to executives at Fannie Mae and Freddie Mac...and they're not stopping with hot-tempered rhetoric. Rep. Spencer Bachus, chairman of the House Financial Services Committee, has scheduled a committee vote for next Tuesday on a bill that would suspend the compensation packages awarded to the GSEs' top executives. Sens. Jay Rockefeller and John McCain say they plan to follow suit with a similar bill in their own chamber.

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Fannie Mae Requests $7.8B From Taxpayers to Cover Q3 Deficit

The nation's largest mortgage company says it lost $5.1 billion during the third quarter of this year. That combined with a $2.5 billion dividend payment to Treasury for past bailout money left Fannie Mae with a $7.8 billion hole to fill. Upon receipt of those funds, Fannie Mae's total debt obligation to U.S. taxpayers will be $112.6 billion. The GSE held 122,616 single-family REO properties as of the end of September, and completed 87,533 foreclosure prevention actions during the quarter.

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Lawmakers Want Answers on Bonuses to GSE Execs

Lawmakers on Capitol Hill are up in arms over the news that the Federal Housing Finance Agency (FHFA) approved $12.79 million in bonus pay for 10 executives at Fannie Mae and Freddie Mac. Sixty senators put their partisan differences aside and presented a united front in a letter to FHFA Acting Director Edward DeMarco and Treasury Secretary Timothy Geithner, in which they criticized such compensation as ""wildly imprudent"" and expressed concern over the message it sends to millions of American families who are tightening their belts.

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Senators Wish to Make HARP Available to High-Equity Borrowers

While the newly revised Home Affordable Refinance Program (HARP) includes several provisions aimed at widening the program's reach, Sens. Barbara Boxer of California and Johnny Isakson of Georgia are asking the Obama administration to broaden the program even more by opening it up to homeowners with higher equity in their homes. Currently, the revised program is aimed at helping those with less than 20 percent equity. Lawmakers say nearly 12 million more borrowers would benefit if there were no equity restraints.

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Freddie Mac Requests $6B More in Taxpayer Aid

The nation's second largest mortgage company is asking the U.S. Treasury for another $6 billion in capital support after posting its largest quarterly loss in over a year. Freddie Mac says it recorded a net loss of $4.4 billion for the quarter ended September 30, 2011, after shouldering a $4.8 billion loss on derivatives and a $3.6 billion provision for credit losses related to high levels of mortgage refinancing and lower mortgage insurance recoveries. The GSE's REO operations expense skyrocketed to $221 million in the third quarter, compared to $27 million for the second quarter.

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CoreLogic Identifies HARP 2.0 ‘Winners and Losers’

The administration unveiled its revamped Home Affordable Refinance Program (HARP) last week to allow borrowers who owe significantly more than their home is worth take out new loans with lower interest rates. CoreLogic says the impact will be targeted to those markets and local economies that have suffered the most from the housing collapse. The company believes HARP 2.0 will be positive for the GSEs and the origination market, negative for bondholders, and neutral for housing itself because distressed borrowers and shadow inventory are left out of the equation.

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Officials Say GSE Bailout Will Cost Less Than Originally Estimated

The Federal Housing Finance Agency (FHFA) has lowered its projection for just how much taxpayer funding is needed to support the nation's two largest mortgage financiers. FHFA estimates that Fannie Mae and Freddie Mac will need between $220 billion and $311 billion from the American people when all is said and done. Those figures represent capital assistance from September 2008, when the two mortgage giants were placed into conservatorship, through the end of 2014.

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