Calabria Seeks To End Conservatorship By Jan. 20

Federal Housing Finance Agency Director Mark Calabria is trying to pull Fannie Mae and Freddie Mac out of conservatorship before the Trump Administration ends on January 20, the Wall Street Journal reported. Mark Calabria, a libertarian economist who heads the Federal Housing Finance Agency, has made it a priority to return Fannie and Freddie to private hands, a goal shared by Mr. Mnuchin. How that is done could affect the cost and availability of mortgages backed by the companies, which guarantee roughly half of the $11 trillion in existing home loans. Completing the complex process before President Trump’s term ends on Jan. 20 is a long shot, and President-elect Joe Biden is considered unlikely to continue the effort. But Messrs.…

Freddie Appoints CFO Amid Conservatorship Exit Prep

Christian M. Lown will be the new chief financial officer and executive vice president of Freddie Mac as the company seeks to emerge from conservatorship, Freddie announced Tuesday. Lown replaces Donald F. Kish, who has served as interim CFO since December. Kish will continue serving as Senior Vice President, Corporate Controller and Principal Accounting Officer. “I am excited to join Freddie Mac as the company prepares for its next chapter and I look forward to working with such a talented management team and innovative company,” said Lown said. At Navient, Lown was responsible for the accounting, corporate development, financial planning and analysis, investor relations, procurement, treasury, and vendor management functions. Prior to joining Navient in 2017, Lown was Managing Director,…

GSEs Seek Advisors To Leave Conservatorship

Fannie Mae and Freddie Mac are looking for financial advisors to help them emerge from conservatorship. Each of the GSEs announced they will be issuing a request for proposal on Tuesday to “secure a financial advisor that will facility the company’s responsible exit for conservatorship. The advisors will help Fannie and Freddie on everything from capital considerations to business plans to capital raising activities and more. “Even as we work to stabilize the housing markets during this unprecedented pandemic, Freddie Mac has remained focused on exiting conservatorship responsibly,” David Brickman, Freddie Mac CEO David Brickman said. “Today we begin the competitive selection process for a financial advisor that will ultimately facilitate our return to full private capital ownership. This is…

Mortgage Roundup (3/17/21) – St. Patrick’s Day Edition

Good morning! Today is Wednesday, March 17. President Biden will hold his first news conference March 25. The Federal Aviation Administration extended the “zero-tolerance” policy for bad air travel behavior while the federal mask mandate is in place. Los Angeles Lakers star LeBron James is set to become part-owner of the Boston Red Sox. And in mortgage and housing news … BROKER WARS: The Mortgage Note reports on a consumer group launching a campaign designed to raise awareness among policymakers about the Broker Wars in an effort to put pressure on United Wholesale Mortgage over their refusal to work with brokers who do business with two competitors. MORTGAGE APPS: The Mortgage Note reports that mortgage applications for new home purchases for February fell by 9…

Mortgage Roundup (1/29/21) – Biden, Rates & Rules

Good morning! Today is Friday, January 29. General Motors announced it will sell only zero-emissions vehicles by 2035. The New York Attorney General says the state’s nursing home deaths were undercounted by 50 percent. A faster-spreading South African variant of the coronavirus was detected in the U.S.  And in mortgage and housing news … BIDEN IMPACT: The burning question for lenders in 2021 is: How will President Biden, who’s been around this block before, respond to today’s complex housing market that has been propped up by forbearance and historically low interest rates? DOWNPAYMENT OPTIONS: There may be an upside for the young adults who were forced to move back home with their parents during the pandemic. MORTGAGE RATES: Mortgage rates fell for the second consecutive week, inching closer…

Mortgage Roundup (1/15/21) – IPOs, GSEs & NYC

Good morning! Today is Friday, January 15. President-elect Joe Biden is urging Congress to back a round of $1,400 per-person direct payments and asking for funding for testing and vaccine distribution. Weekly filings for jobless benefits hit the highest level since July. A NASA study reports 2020 and 2016 are the warmest years on record since 1880. And in mortgage and housing news … IPO’D: Even in the middle of an economic recession, IPOs are booming and mortgage companies don’t want to miss out. The mortgage industry at large is at a peculiar crossroads and companies and investors are jumping to cash in on a unique set of circumstances, at least in the short term. GSE NO CHANGE: The Trump Administration announced that…

GSEs To Stay Under Govt Control For Time Being

The Trump Administration announced Thursday that it would not seek to pull Fannie Mae and Freddie Mac out of conservatorship before President Trump leaves office next week.  Instead, the Department of Treasury and the Federal Housing Finance Agency announced amendments to their preferred stock purchase agreements that allows Fannie and Freddie to keep more of their earnings as they continue to work to leave conservatorship. “Today’s agreement that allows Fannie Mae and Freddie Mac to continue retaining earnings is a step in the right direction, but more hard work remains,” FHFA Director Mark Calabria said. “Capital at Fannie Mae and Freddie Mac protects the housing finance system and taxpayers. Retained earnings alone are insufficient to adequately capitalize the Enterprises. Until…

Rule Would Require Living Wills For Fannie, Freddie

The Federal Housing Finance Agency announced a new proposed rule Tuesday that would require Fannie Mae and Freddie Mac to have living wills, similar to what many large financial institutions must file under federal law. Under the proposed rule, Fannie and Freddie will have to demonstrate “how core or important business lines would be maintained to ensure continued support for mortgage finance and stabilize the housing finance system, without extraordinary government support to prevent (Fannie or Freddie) from being placed in receivership, indemnify investors against losses, or fund the resolution of (Fannie or Freddie).” “The rule proposed today is an important step toward a stronger housing finance system. Requiring the Enterprises to develop living wills, helps FHFA fulfill its responsibility…

Mortgage Roundup (12/21/20) – Rates, GSEs & Credit

Good morning! Today is Monday, December 21. Members of Congress struck a deal on a nearly $900 billion virus relief package. A CDC advisory group recommends that the next COVID-19 vaccinations be given to older adults and front-line essential workers, like fire, EMT, food manufacturers, grocery and public transit employees, teachers, postal workers. Jupiter and Saturn will appear closer in the night sky tonight than they have in nearly 400 years. And in mortgage and housing news … MORTGAGE RATES: Mortgage rates have tumbled to a new all-time low, falling to a 2.67 percent, according to the weekly Primary Mortgage Market Survey released by Freddie Mac. GSE SAGA: Without appropriate oversight, Fannie Mae and Freddie Mac could easily repeat the mistakesthat put them in…

FHFA Proposes GSE Liquidity Rules

The Federal Housing Finance Agency on Thursday announced a proposed rule on liquidity requirements for Fannie Mae and Freddie Mac, including reporting rules and minimum liquidity and funding. The four liquidity requirements in the proposed rule include: A short-term 30-day requirement that is based on a cumulative net cash outflow analysis, plus an additional $10 billion cushion requirement that must be met by highly liquid assets, like Treasury securities.A 365-day requirement extending the short-term cumulative cash outflow analysis to a full year. Over this intermediate term, Fannie and Freddie may count borrowings against certain fixed income instruments that the Fixed Income Clearing Corporation deems eligible collateral (subject to a haircut), which they cannot count under the 30-day requirement. There is…