Tag Archives: FHFA

Rep. Gary Miller of California is introducing a new idea for GSE reform - a merger of Fannie Mae and Freddie Mac. The bill, drafted by Miller and co-sponsored by Rep. Carolyn McCarthy of New York, suggests the resulting entity would purchase mortgages and sell them to investors as government-backed securities. According to Miller, the new corporation would be privately capitalized but not privately owned, and would be limited to a market share of no more than 50 percent.

Freddie Mac has issued a bulletin to servicers announcing changes to the company's default management requirements. The move is part of the Servicing Alignment Initiative announced by the Federal Housing Finance Agency in late April to bring both Fannie Mae's and Freddie Mac's procedures for handling past-due mortgages in line with one another. Freddie also alerted servicers that it plans to roll out a new modification solution for borrowers who defaulted on previous modifications and who are ineligible for HAMP.

Servicers have been ordered to institute a clear resolution process for consumer complaints. Accountability when it comes to dealing with distressed borrowers has become a central focus of mortgage servicing reform, but an audit conducted by the Federal Housing Finance Agency's inspector general found that the GSEs' regulator is itself lacking in this area. The report says the agency has let complaints alleging fraud, abuse, and improper foreclosures slip through the cracks with no oversight of their resolution. FHFA says it will take actions to remedy the issue.

Home prices in the U.S. rose in April for the first time since last spring, the Federal Housing Finance Agency (FHFA) reported Wednesday. The agency's House Price Index recorded a 0.8 percent seasonally adjusted increase between March and April - the first month-over-month gain since May 2010. The index is calculated using purchase prices of houses backing mortgages that have been sold to or guaranteed by Fannie Mae and Freddie Mac.

The Federal Housing Finance Agency (FHFA) issued its third report to Congress Monday, detailing the regulator's 2010 annual examinations of Fannie Mae and Freddie Mac. The GSEs' losses last year totaled $28 billion, versus $94 billion in 2009. The amount of taxpayer support needed by the two mortgage giants also narrowed, but FHFA says both Fannie and Freddie remain ""critical supervisory concerns,"" primarily because of continuing credit losses from loans originated during 2005 through 2007.

Foreclosure prevention actions on loans held by Fannie Mae and Freddie Mac declined during the first three months of this year, driven primarily by loan modifications. Permanent loan mods dropped for the third consecutive quarter to 86,201. Short sales were essentially flat at 25,705. According to the GSEs' regulator, even with the drop-off in loss mitigation actions the two companies' delinquency rates ""remain below industry levels."" In the first quarter, foreclosure starts declined while completed foreclosures increased.

Fannie Mae laid out new standards for mortgage servicers Monday related to the management of delinquent loans. The move is part of the Servicing Alignment Initiative announced by the company's regulator in late April to bring both Fannie Mae's and Freddie Mac's procedures for handling past-due mortgages in line with one another. The new rules are intended to address identified servicing issues such as the commencement of foreclosure actions while loss mitigation talks are ongoing and breakdowns in borrower communication.

Fannie Mae and Freddie Mac have both reported another drop in the share of single-family home mortgages they hold that are 90 or more days delinquent. Fannie's serious delinquency rate declined 17 basis points to 4.27 percent. Freddie's fell 6 basis points to 3.57 percent. Except for one blip of an increase last September for Freddie, the GSEs have seen their serious delinquencies fall for 12 months. The servicing alignment initiative announced by the two companies is expected to speed the resolution process for past-due loans.

Modified mortgages held by Fannie Mae and Freddie Mac could go up for sale at some point, according to the companies' regulator. Since the GSEs were seized by the government, they have completed modifications on 849,000 mortgages. The sale of these assets is one option being discussed as part of a strategy to shrink their portfolios. The head of the Federal Housing Finance Agency told lawmakers that they are looking at a range of possible structures for disposing of certain assets, which could include non-performing and modified loans.

Home prices in the U.S. continue to tumble as foreclosures claim a larger share of the market. Residential prices slipped 2.5 percent during the first quarter of this year when compared to the previous quarter, according to a national index calculated using sales prices from mortgages acquired by Fannie Mae and Freddie Mac. The index shows prices fell 5.5 percent between the first quarter of 2010 and the first quarter of 2011. It's the largest annual drop recorded since the second quarter of 2009.