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Fannie and Freddie revamp repurchases


PlanMaestro

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Turn, turn, turn, there is a season, turn, turn, turn. Damn Alex Rubalcava and his song recommendations in Twitter.

 

http://www.ft.com/cms/s/0/6b35fddc-fb91-11e1-b5d0-00144feabdc0.html#ixzz267fHtsOT

 

The new policies were announced on Monday by the companies’ regulator, Edward DeMarco of the Federal Housing Finance Agency. They include giving lenders a reprieve from possible “putbacks” if borrowers have made their monthly payments for the first 36 months of a loan and earlier reviews of possible underwriting breaches.

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BofA, once the largest mortgage lender in the US, had about $11bn in outstanding repurchase requests from Fannie Mae and Freddie Mac as of June 30, according to the bank’s securities filings.

 

Bank analysts have pointed to Fannie Mae and Freddie Mac’s repurchase requests as a reason for investors to be cautious when debating whether to purchase shares of large US home loan lenders like BofA. BofA said that during the first six months of this year, it received $6.3bn of repurchase requests from Fannie Mae, of which $4.4bn had been on loans for which the borrower had made at least 25 payments. Borrowers had made at least 37 payments on $2.1bn of the loans.

 

The new rules will not affect existing disputes over loans that have defaulted. Mortgages sold or delivered to the housing financiers beginning in 2013 will be eligible under the new guidelines.

 

 

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