Tag Archives: Freddie Mac

The Obama administration is setting the stage for a public-private collaboration to tackle the growing inventory of REO homes. On Wednesday, federal officials called on private investors and industry stakeholders to share their recommendations on how best to dispose of foreclosed homes held by Fannie Mae, Freddie Mac, and FHA. Together, the three hold nearly 250,000 REO homes. Federal officials believe the most effective tactic is to sell off pools of properties to responsible investors who will employ an REO-to-rental strategy.

Freddie Mac said Monday that it logged a $2.1 billion net loss for the second quarter. The company has requested $1.5 billion in taxpayer funding from Treasury, bringing the total amount of its capital draws while in conservatorship to $66.2 billion. Freddie's latest financials represent a slide from the previous quarter, when it posted a $676 million profit and needed no money from Treasury. The GSE acquired 24,799 REO properties through foreclosure in the second quarter but sold 29,355, shrinking its inventory of repossessed homes.

Congress' last-minute accord to avert a default wasn't enough to save the United States' top rating from Standard & Poor's. The agency downgraded the long-term credit rating of the U.S. to AA+, a grade just below the AAA rating the U.S. had held for 70 years. Analysts were expecting a temporary spike in Treasury yields, which are closely tied to mortgage rate trajectories, but investors responded with a rush on Treasuries, pushing yields down 13 basis points. Fannie Mae, Freddie Mac, and the Federal Home Loan Banks also had their S&P ratings lowered to AA+ on Monday.

Senator Jack Reed (D-Rhode Island) has sent a letter to the director of the Federal Housing Finance Agency (FHFA) recommending the agency require Fannie Mae and Freddie Mac rent out foreclosed properties rather than immediately attempting to sell them at bargain prices. Reed believes renting the properties would help the market on all fronts by reducing foreclosure inventories, providing affordable housing, and creating jobs in hard-hit industries.

After heading higher for three straight months, the nation's unemployment rate declined to 9.1 percent in July, down from 9.2 percent in June, according to figures released Friday by the U.S. Department of Labor. The economy added 117,000 jobs last month. July's numbers beat analysts' forecasts. Investors are hoping the news will help dispel fears of a double-dip recession and quell some of the sell-off frenzy seen in the stock market yesterday, which led to the largest one-day drop in the Dow since the financial upheaval following Lehman Brothers' collapse.

Freddie Mac released the results of its weekly rate survey Thursday, showing mortgage rates have dropped sharply over the past few days amid falling bond yields and signs of a weaker-than-expected economy. The 30-year fixed-rate mortgage has declined to its lowest level for 2011, while both the 15-year fixed mortgage and 5-year adjustable-rate mortgage (ARM) set new historical record lows. Of the four loan types the GSE assesses, only the 1-year ARM failed to post a decline this week.

The Federal Housing Finance Agency (FHFA) filed a lawsuit last week in a New York federal court against UBS Americas, Inc. for violations of federal securities laws related to UBS' sale of $4.5 billion in private-label residential mortgage-backed securities to Fannie Mae and Freddie Mac. The lawsuit alleges that UBS Americas made material misstatements and omissions about the mortgage loans underlying the bonds. Fannie and Freddie claim they have already lost in excess of 20 percent of their entire investment.

Data released by Freddie Mac Thursday shows that amid mixed economic reports and ongoing debate over the nation's debt, the average rate for a 30-year fixed mortgage edged up ever so slightly this week but hit its highest mark in three weeks. Rates for adjustable-rate mortgages, on the other hand, inched down to a three-week low. The 15-year fixed-rate mortgage remained unchanged from a week earlier.

The Collingwood Group announced Wednesday that it has retained Manoj K. Singh as a special advisor. In his new role, Dr. Singh will work with the Collingwood Group to help clients navigate the business opportunities that exist in Washington as a result of the housing crisis. Dr. Singh was previously SVP of single-family pricing and securitization at Freddie Mac. He also held executive-level positions with Bear Stearns, Lehman Brothers, and Wasserstein Perella Capital Management.

Interest rates on fixed-rate mortgage loans inched up this week amid mixed economic data, according to Freddie Mac. The GSE's weekly survey puts the average 30-year fixed rate at 4.52 percent for the week ending July 21, and the 15-year rate at 3.66 percent. Adjustable-rate mortgages (ARMs) were mixed in Freddie's latest survey. The company's analysts calculate average interest rates based on data from about 125 lenders across the country.