Tag Archives: Freddie Mac

Currently their line of credit with Treasury would provide about 5 percent capitalization and the current guarantee fee of 63 basis points would provide about 3 percent; they would need to increase their G-fees by about 27 basis points to raise the additional 2 percent capital.

Only six percent of renters who have lived in their home longer than two years have experienced a decrease in their rent amount, while 38 percent of renters experienced an increase in their rent amount in the last two years.

According to the FHFA, the initial goal was to assist in building a Common Securitization Platform (CSP) and support the statutory obligation to ensure the liquidity of the nation’s housing finance markets issued by the FHFA. Taxpayers would also not have to suffer the cost of subsidizing Freddie Mac’s securitization of single-family mortgage loans with the Single Security.

Today, Freddie Mac receives about one tenth of the amount of calls it was receiving during the immediate aftermath of the housing crash (about 40,000 per month, or 1,300 per day), but many homeowners facing financial setbacks are still calling Freddie Mac hoping the GSE will have a solution for them, whether it allows them to keep their home or is of the non-home retention variety.

The nearly two-month long court battle between the Federal Housing Finance Agency (FHFA) and Nomura Holdings came to an end Monday when a federal judge found the bank liable for selling shoddy mortgages to Fannie Mae and Freddie Mac prior to the 2008 financial crisis.

Royce said in a statement on his website that it is "unconscionable" that Freddie Mac would elevate the pay of its CEO to that level while taxpayers are still on the hook. The fact that the GSEs are still under conservatorship of the FHFA, where they have been since September 2008, is still a contentious one among politicians and stakeholders in the housing market.

Derivative losses were largely responsible for dropping Freddie Mac's net income by nearly $2 billion from Q3 to Q4 down to $227 million, but the GSE responded by nearly doubling that net income total in Q1 to $524 million. It marked the 14th consecutive quarter of profitability for Freddie Mac. In Q1, derivative losses declined to $2.4 billion, down from $3.4 billion the previous quarter.

Fitch Ratings affirmed that while Fannie Mae and Freddie Mac maintained a "Stable Rating Outlook" in April due to direct financial support from the U.S. government, the ratings company said it expected the controversial FHFA's conservatorship of the two Enterprises would continue indefinitely.

Freddie Mac reported a net income of $227 million for the fourth quarter of 2014, a decline of $1.9 billion from the third quarter. The GSE attributed the drop in net income to derivative losses, which totaled $3.4 billion for the quarter driven by declining interest rates.

The Dodd-Frank Act Stress Tests (DFAST) – Severely Adverse Scenario report indicated that the two GSEs would need a second taxpayer bailout, this time of up to $157.3 billion, under hypothetical adverse economic conditions that included a rise in the nation's unemployment level up to 10 percent by the middle of 2016; a decline in real GDP as large as 4.5 percent by the end of 2015 before recovery begins in 2016; and long term interest rates drop significantly while short-term rates remain near zero.