Fannie Mae (FNMA)

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This is a better explanation.
Single Security and the Common Securitization Platform (CSP)

The Single Security is a joint initiative of Fannie Mae and Freddie Mac (the Enterprises), under the direction of FHFA, to develop a single mortgage-backed security that will be issued by the Enterprises to finance fixed-rate mortgage loans backed by one- to four-unit single-family properties. The Enterprises will align key components of Fannie Mae’s mortgage-backed securities (MBS) and Freddie Mac’s Participation Certificates (PCs). The goal is to bring additional liquidity and fungibility to the “To-Be-Announced” (TBA) market and to reduce or eliminate the trading disparities that exist today between the Enterprises’ TBA securities. The components of the Single Security initiative include aligning (1) key features, which will mainly follow Fannie Mae’s MBS structure; (2) investor disclosures, which will generally follow Freddie Mac’s PCs; and (3) certain policies and practices related to the removal of loans from securities. In addition, the Single Security effort will allow investors to exchange their legacy 45-day Freddie Mac Participation Certificates (PCs) for new 55-day Single Securities issued by Freddie Mac.

The CSP is a technology and operational platform that is being developed by Common Securitization Solutions, LLC, a joint venture of Fannie Mae and Freddie Mac. CSP will perform many of the core back office operations for the Single Security, as well as most of the Enterprises’ current securitization functions for single-family mortgages, on behalf of the Enterprises. The CSP is necessary for the implementation of the Single Security.

To learn more about the initiatives refer to the Frequently Asked Questions (FAQs) available on these web pages.

FHFA and the Enterprises are gathering market feedback to understand how the Single Security will impact market participants’ processes and systems as well as to understand the amount of time the market may need in order to prepare for the conversion to the Single Security.

http://www.freddiemac.com/mbs/html/single_security_csp.html