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It is national dog day! No poop! I googled it. Bad omen for a stock?
Go FnF!
You forgot about my spinner bait plan. I am sure that was an unintentional oversight!
Go FnF!
FnF didn't get TARP funds. They got Charter's bailout funds. Actually, the TARP fund was closed without paying FnF what was due for participating in the MHA program and also the amount that they advanced to the mortgage servicers under this plan but later FnF weren't reimbursed.
Is this true about not getting reimbursed?
FnF didn't get TARP funds. They got Charter's bailout funds. Actually, the TARP fund was closed without paying FnF what was due for participating in the MHA program and also the amount that they advanced to the mortgage servicers under this plan but later FnF weren't reimbursed.
— Conservatives against Trump (@CarlosVignote) August 7, 2019
It is called spinner bait plan. Caught one already!
Go FnF!
They all get FnF commons for $25 which is a 75% discount. This and years of tax breaks for their investment $$$. Jr. Prefs get par commons go to $100.
Done
It could be a trap see? Trick the greenhorns into buying and then beat the stock down to a hammered shit $1.75
It's ok! $1.75 is my next buy. I still have one kid left to sell!
Go FnF!
You are Sparky!
This is crazy this is crazy. This is crazy
Go FnF!
Noted but is he a phony realist? Or is he a real phony?
Go FnF!
Is Qatar back in?
Go FnF!
I told you all so! See my previous post.
Go FnF!
I think that somebody thinks that somebody else knows that somebody knows something! It's obvious!
Go FnF!
Impact of the Economy on Default Risks
in Daily Dose, Featured, Foreclosure, News 18 mins ago
?Mortgage default risk rose in the U.S. in Q1 2019 as a result of increased economic risk and borrower risk, according to the recently launched Milliman Mortgage Default Index (MMDI).
The quarterly report calculates a lifetime default rate estimate based on the loan level for a portfolio of single-family mortgages delivered to Fannie Mae, Freddie Mac, and Ginnie Mae. The data for Q1 2019 indicated that the MMDI for government-sponsored enterprise (GSE) acquisitions increased to an estimated average default rate of 2.19%, up from 1.83% in 2018. For Ginnie Mae loans, the Q1 2019 MMDI rate rose to 8.77%, from 7.09% in the prior-year period.
"Default risk is driven by various factors including the risk of a borrower taking on too much debt, underwriting risk such as certain mortgage features, and economic risk such as a recession, which can put pressure on home prices," said Jonathan Glowacki, principal and consulting actuary at Milliman and author of the MMDI. "In the first quarter of 2019, we've seen default risk creep up for both GSE and Ginnie loans as a result of an increase in borrower debt-to-income ratios, credit score drift, and the anticipated increased risk of an economic downturn."
Comparing the current data to the actual to-date default rate of GSE mortgages shortly before the financial crisis in 2007, the MMDI indicated that the actual to-date default rate for Freddie Mac at that time was 13.8%.
Similarly, the actual to-date default rate for Federal Housing Administration (FHA) loans originated in 2007 was approximately 26.5%, according to FHA's Single Family Loan Performance Trends report as of February 2019. "While this data is not directly comparable, these numbers provide an equivalent comparison of the magnitude of defaults during the crisis relative to the expected mortgage default risk for new originations in 2019," the report indicated.
Click here to view the detailed findings of this index
https://dsnews.com/daily-dose/08-06-2019/impact-of-the-economy-on-default-risks
Calabria noted that the patch “exacerbates an unlevel playing field” in the mortgage market and said that he believes “Fannie and Freddie should play by the same rules as everyone else.”
Mark, do you mean like having the board of directors run the companies instead of you
Go FnF!
THAT ISN'T FUNNY! lol
This en banc is so huge and unique and such a potential DC shit storm/tornado/hurricane/typhoon that I think the past en banc statistics do not matter. Whatever leverage can be used to stall will be used to stall. Of course just my opinion. I have no idea how to influence an en banc to stall. Maybe there are 17 sets of unjudge like photos.
Go FnF!
Toronto mayor Rob Ford and DC mayor Marion Barry vouched for him!
Go FnF!
I really wish it was up to me to decide how much time to give SM and treasury, MC and FHFA, Trump, Sweeney etc.
Alas all we can do is vent and buy more!
Go FnF!
If this doesn't work out he is the crypt keeper!
Go FnF!
If the story is real he will be back if this implodes. If it works out he will retire. Me too. We will keep in touch. What is better than having a yacht? Having a buddy with a yacht!
Go FnF!
Thanks Crypto! It makes me feel like we are a band of dumbasses. Maybe geniuses. Time will tell. Maybe a short time.
Go FnF!
How are the GSEs in trouble?
Go FnF!
Short Takes: Fannie Mae Warns of a ‘Draw’ From Treasury / Blame CECL / Ginnie Places Restrictions on Cash-out Refis of VA Loans / Blank Rome Hires Industry Veteran Samlin
pmuolo@imfpubs.com, dhollier@imfpubs.com
Fannie Mae had a blowout second quarter, posting a strong profit of $3.4 billion but the GSE warned that thanks to the coming “current expected credit loss” (CECL) accounting standard it may suffer a reduction in retained earnings of roughly $4 billion. And since its retained capital is $3 billion, you can do the math…
In its earnings report, the government-sponsored enterprise explained that come January 2020, the CECL standard likely will “introduce additional volatility in the company’s results as credit-related income or expense will include expected lifetime losses on the company’s loans and other financial instruments subject to the standard and thus become more sensitive to fluctuations…”
Presumably, the Federal Housing Finance Agency is well aware of all this…
Ginnie MaeThursday morning placed restrictions on cash-out refis of high LTV loans that can be securitized into Ginnie I and II pools. In an All Participants Memo, the agency states: “This APM revises the pooling eligibility requirements applicable to all VA-guaranteed refinance loans and establishes new pooling criteria for certain cash-out refinances with loan-to-value ratios exceeding 90% … Effective with mortgage-backed securities guaranteed on or after November 1, 2019, High LTV VA Cash-Out Refinance Loans (those with LTV ratios above 90%) are ineligible for Ginnie Mae I Single Issuer Pools and Ginnie Mae II Multiple Issuer Pools. The exception is in cases when the loans are Permanent Financing Construction Loans…”
MORTGAGE PEOPLE: The New York-based Blank Rome law firm hired Scott Samlinas partner in charge of its consumer financial services group. Samlin will provide regulatory counsel related to mortgage banking and consumer issues. He joins the firm from Pepper Hamilton LLP where he was a partner in the financial services practice group. His resume includes stints at Morgan Stanley and Bear Stearns.
I heard that it was MargSween LLC. that bought the 2.5 million fnma shares yesterday. Is anybody familiar?
Go FnF!
I will wait for it.
Dip and rip!
Those affirmation videos are really kicking in!
Go FnF!
As a wise owl once said
THE WORLD MAY NEVER KNOW!
Go FnF!
I have a good feeling! But I have been watching YouTube affirmation videos.
Go FnF!
I wonder if there will be any large t-trades that settle up after the close.
Go FnF!
It is easy to marvel at the power of market makers when the SEC is blind but lots of us have seen this movie before. I hope you could all take advantage of the situation today.
Go FnF!
So far I lost 15 cents today on my old shares and I made 15 cents on my shiny new shares. We will be fine.
Go FnF!
So where is th fmcc volume if big institutions are switching over from fnma?
Yesss that was a whale!
Go FnF!
YUKAYUKAYUKA!
Can anybody tell if there were any massive buys?
Fannie Mae transfers $1.7bn of single-family mortgage risk to re/insurers
(So mean while Fannie just keeps taking care of business) That part was me!
31st July 2019 - Author: Matt Sheehan
US Government-sponsored enterprise, The Federal National Mortgage Association (Fannie Mae), has undertaken a new Credit Insurance Risk Transfer (CIRT) deal, securing $1.7 billion of re/insurance for a pool of primarily single-family affordable loans.
?This CIRT LR FE 2019-1 transaction provides front-end coverage of loans to be delivered to Fannie Mae over a forward 12-month period plus bulk coverage of existing loans, together insuring up to $1.75 billion of high loan-to-value ratios.
In aggregate, the transaction will transfer up to approximately $154 million of credit risk.
As part of Fannie Mae’s ongoing effort to reduce taxpayer risk by increasing the role of private capital in the mortgage market, it has committed to acquire about $9.4 billion of insurance coverage on $360 billion of single-family loans through the CIRT program to date.
“This deal pioneered new ground as our first CIRT transaction to cover a targeted pool of single-family affordable loans,” said Rob Schaefer, Vice President for Credit Enhancement Strategy & Management, Fannie Mae.
“We extend our deep appreciation for the insurer and reinsurer partners that work with us on unique deals such as this, along with our HFA and lender partners that originate and deliver these loans to Fannie Mae,” he continued. “Together, they help us serve our affordable housing mission that is at the heart of Fannie Mae’s business.”
“As this deal demonstrates, we continue to diversify our CIRT offerings, and are proud to be a leader in building and supporting the market for transferring Single-Family mortgage credit risk to private sources of capital.”
The latest CIRT deal secures commitments from a panel of eight insurers and reinsurers to cover up to $1.15 billion in unpaid principal balance for loans to be acquired by Fannie Mae between July 2019 through June 2020.
Additionally, this transaction covers approximately $600 million in unpaid principal balance of loans previously acquired by the company between January 2018 through August 2018.
All covered loans will be originated with fixed rate notes, original terms of 21 to 30 years, and loan-to-value ratios greater than 80 percent and less than or equal to 97%.
Fannie Mae will retain risk for the first 250 basis points of loss on the aggregate covered pool. If the $43 million retention layer is exhausted, reinsurers will cover the next 880 basis points of loss on the pool, up to a maximum coverage of approximately $154 million.
https://www.reinsurancene.ws/fannie-mae-transfers-1-7bn-of-single-family-mortgage-risk-to-re-insurers/
Because this movement ain't for nothing. The proof is in the stock price. It could be some misinterpreted info. It could be a tree shaking party from hell which would mean good news. I don't know what. Over 18 mil shares have traded. I think we find out soon.
Go FnF!
There is bound to be some big news soon.
I did not say good news. I said big news
Go FnF!
I just sold some aapl and bought 2000 shares of this dog for $2.05.
Am I insane?
Nerves of steel or an idiot?
Go FnF!
UNDERSTANDING THE END OF THE QM PATCH
Thomas Wade
Executive Summary
The Consumer Financial Protection Bureau (CFPB) requires that all mortgage borrowers have a debt-to-income ratio of below 43 percent (the “Qualified Mortgage,” or QM, rule), but it created an exception for mortgages backed by Fannie Mae and Freddie Mac (the QM Patch).
The QM Patch allows Fannie Mae and Freddie Mac to breach CFPB regulations by backing mortgages to borrowers with a higher ratio of debt to income, but the CFPB has indicated that it will allow the QM Patch to expire in 2021, eliminating this privilege.
While allowing the QM Patch to expire will likely decrease mortgage availability, particularly for those with low incomes, it also will necessarily decrease the systemic risk implicit in the U.S. housing sector.
Introduction
Last week the Consumer Financial Protection Bureau (CFPB) announced that it would allow its special treatment of some mortgages backed by Fannie Mae and Freddie Mac, also known as the QM Patch, to expire in 2021. This piece addresses some of the questions around this change in policy:
What is the QM Patch?
What made the QM Patch such bad policy?
What are the consequences of the expiration of the patch?
How has the housing finance world reacted?
How should this be viewed in light of the broader ongoing housing reform debate?
What is the QM Patch?
The CFPB requires lenders to assess the likelihood that their borrowers will be able to repay the loans they take out, a requirement known as the “Qualified Mortgage,” or QM, rule. The assessment that lenders perform is a simple one; a calculation of debt to income (DTI). As an example, if my debts (be they mortgage, auto, or any kind) totaled $1,000 per month, and my income $3,000 per month before tax, my DTI is 33 percent. Alternately, if my monthly income is $2,000 per month, my DTI is 50 percent. Usually, a lower DTI improves your chances of obtaining a loan or a line of credit, as there is a much greater likelihood that the loan will be repaid. Most lenders generally prefer a DTI of 33 to 36 percent, as, again, at this ratio borrowers are statistically more likely to continue to make payments. The CFPB’s requirements prevent lenders from offering loans to borrowers who exceed a 43 percent DTI.
The effect of this rule is to prevent the riskiest borrowers, or those more likely to default, from becoming homeowners. This makes sound economic sense, but the rule makes it harder for some people to reach the American Dream of homeownership, and as a result one very important exception to the rule exists. Former CFPB Director Richard Cordray introduced the QM “Patch,” which allows Fannie Mae and Freddie Mac, the government sponsored enterprises (GSEs), to back loans with a DTI exceeding 43 percent, thereby allowing those risky borrowers to obtain mortgages.
The QM Patch was always intended to be temporary and is due to “sunset,” or expire, in 2021. By declining to continue the special treatment for the GSEs, the CFPB has indicated that those with a DTI exceeding 43 percent will no longer be able to take on mortgages.
What made the QM Patch such bad policy?
The benefits of the QM rule are wide-ranging: borrowers are less likely to default; lenders are less likely to lose money, as they have performed appropriate risk-management assessments (and they typically wouldn’t loan to individuals above that DTI anyway, as noted above); and the economy is slightly less likely to suffer the shock that a large number of defaults within a short period might cause. Anything that allows an exception to this rule, particularly by providing loans to those far less likely to be able to repay, does not make sound policy.
In addition, the QM patch is wildly anti-competitive, as it is an advantage only the GSEs enjoy. The GSEs already enjoy a tremendous advantage over private industry due to their government backing, and this rule only further shuts private mortgage providers out of the secondary mortgage market.
The problems with the QM patch are not merely philosophical, either. The QM patch currently enables almost a third of all GSE-backed loans, a proportion that has only grown in recent years. One analysis finds that in 2018 the QM Patch accounted for 16 percent of all mortgage originations in 2018, comprising $260 billion in loans. To allow for more risk to enter the housing market is contrary to the purpose of Dodd-Frank and reinforces that housing, a risk and inflationary factor in the last recession, is today more risky rather than less.
What are the consequences of the expiration of the patch?
The expiration of the QM Patch will necessarily decrease the availability of mortgages, while also increasing their quality and price. While the long-term impacts will be to decrease systemic risk in the housing sector, in the short-term the riskiest population of borrowers (in practice the less well off) will find it more difficult to get on the housing ladder, a key step in building up equity and demonstrating creditworthiness. We can also expect in the short-term to see a relaxation of standards as private mortgage providers lend above their typical DTI (moving upwards from 33 percent, probably) in order to capture some of this market. Although this relaxation introduces more risk into the system, borrowers are still protected by the QM rule as it normally applies.
The expiration of the QM Patch seems likely also to impact adversely the GSEs’ market share. The QM Patch has enabled a significant book of business for the GSEs, and while they will lose businesses because of this change, it is probable that announcing the end of the QM Patch so far in advance is intended to manage this problem. The GSEs will of course still enjoy the vast benefits that a decade of taxpayer funding and support has provided, but some of this business will flow to private competition.
It is likely that the transitional period that would mark the end of the QM Patch will involve some degree of grandfathering for the current QM Patch mortgages. There could be legal challenges, however.
An Advance Notice of Proposed Regulation (ANPR) that accompanied Thursday’s CFPB press release is seeking industry input into how to manage the transitional period and minimize these concerns. In particular, the CFPB and the Federal Housing Finance Agency (FHFA) are seeking comment on how to fix the qualified mortgage process itself, as the existence of the patch is indicative that it is not fit for purpose.
How has the housing finance world reacted?
Director Calabria of the FHFA, regulator and conservator of the GSEs, accompanied Director Kraninger of the CFPB for the announcement, noting that the QM patch “exacerbates an unlevel playing field” and that “Fannie and Freddie should play by the same rules as everyone else.”
Former FHFA Director Ed DeMarco applauded the move and noted the structural problems with the QM rule: “By itself, a borrower’s debt-to-income is a poor indicator of a borrower’s ability to repay and both the numerator and denominator are very hard to define in regulation.”
Others have noted the likely adverse impact on low-income borrowers. Some industry institutions, including the Mortgage Bankers Association, are seeking changes to the QM rule prior to the sunset of the QM Patch in order to achieve a flexibility in DTI restrictions that will still allow some riskier borrowers to be served.
How should this be viewed in light of the broader ongoing housing reform debate?
Decreasing the GSEs’ market share – and therefore their footprint – will delight proponents of widescale GSE reform, as decreasing the GSEs’ market penetration is viewed as a necessary first step in this process. The announcement marks the first, and only, concrete step toward housing reform in the last decade. It is likely that Director Kraninger is making this move knowing that the current administration is at least contemplating significant reform of the GSEs. The release of a combined Treasury-Housing and Urban Development memo on housing reform, anticipated in the next few months, should make the administration’s intentions clear.
Conclusions
It would be far better to rewrite the rulebook than continue to allow the rules to be broken. Allowing the QM Patch to expire is a painful but necessary step toward decreasing the systemic risk implicit in the U.S. housing market.
https://www.americanactionforum.org/insight/understanding-the-end-of-the-qm-patch/
Read more: https://www.americanactionforum.org/insight/understanding-the-end-of-the-qm-patch/#ixzz5vGcYaOZQ ;
Follow us: @AAF on Twitter
Now I am mad and I don't have spare change to buy more!
Go up FnF!