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GSE Loan Buybacks Edge Higher in 2Q17; Legacy Issues Fading Slowly

By John Bancroft [e-mail]

IMFnews ... Monday, Aug 28, 2017

The volume of defective Fannie Mae and Freddie Mac mortgages repurchased by lenders increased modestly in the second quarter of 2017, according to a new Inside Mortgage Trends analysis of buyback disclosures filed by the two government-sponsored enterprises.

Lenders repurchased some $244.44 million of home loans or made other indemnification to the GSEs during the second quarter. That was up 2.5 percent from the previous three-month period, though it still represented a tiny fraction of the Fannie/Freddie market – barely 0.01 percent of the $4.55 trillion of single-family mortgage-backed securities outstanding at the end of June.

The repurchase disclosures made by the two GSEs cover only securitized loans.

All of the quarterly uptick was at Fannie. Lenders repurchased $148.40 million from the GSE during the second quarter, a 21.5 percent jump. On a year-to-date basis, lender buybacks of the GSE’s loans were still 16.9 percent lower than during the first six months of 2016. For the full story and exclusive tables on loan repurchases by lenders,