home subscribe advertise reprints e-mail help RSS about us LOG IN

Mortgage News


Mortgage News

HOT Topics









site map

twitter linkedin
facebook google+

Mortgage News

News by Subject
Complete list of specialty news sections.

Purchase Subscription
Subscribe to MortgageDaily.com and get immediate access to all news, statistics and archives.

Mortgage Advertising
Reach mortgage executives, loan originators and other people tied to mortgage industry.

Consumer Mortgage News
Free mortgage news for prospective borrowers.

Mortgage Newsletter
Free e-mail newsletter with the latest headlines from MortgageDaily.com.

Mortgage News Reprints
Put entire MortgageDaily.com stories in your online or printed newsletter or publication.

Mortgage Feedget RSS code
Condensed MortgageDaily.com stories free on your Web site or for your RSS reader.

News Archives
Archive of MortgageDaily.com stories by month going back to 1999.

Press Releases
Reports and announcements from MortgageDaily.com.

Mortgage Statistics
Data and statistics for real estate finance.

Mortgage Directories
Directories of lenders, branch operators and mortgage service providers.

Mortgage Graphs
Directories of lenders, branch operators and mortgage service providers.

GSE News | Fannie/Freddie Share Statistics
Fannie, Freddie and FHLB news. Coverage of government sponsored enterprise regulation, operations and litigation.

Fannie Reports Nonprime Business

Alt-A, subprime activity through June 30 disclosed in SEC filing

August 20, 2007

By MortgageDaily.com staff

Fannie Mae disclosed its level of nonprime business in a filing with the Securities and Exchange Commission.

The secondary lender has acquired or guaranteed approximately $310 billion in Alt-A mortgages through June 30, 2007, according to an 8-K filing with the SEC Thursday. Alt-A loans account for 12 percent of its $2.671 trillion book of business. Private-label securities backed by Alt-A loans on the balance sheet were $34.5 billion.

Fannie said it classifies Alt-A loans as mortgages with reduced documentation requirements or other Alt-A product features. This type of business is usually guaranteed for sellers that specialize in prime loans.

The Washington, D.C.-based company said it believes its Alt-A acquisitions -- which have an average loan amount of $172,545, a weighted average FICO score of 720 and a weighted average mark-to-market loan-to-value of 64 percent -- have more favorable credit characteristics than the overall market of Alt-A loans. Adjustable-rate mortgages account for one-third of its Alt-A book, 39 percent have credit enhancement and just 5 percent have LTVs higher than 90 percent.

Serious delinquency was around 10 percent on its Alt-A book at June's end, Fannie reported.

At a $5.1 billion credit book as of June 30, subprime business, typically purchased from subprime lenders, remains just a small share of the government sponsored enterprise's book, the filing said. Private label securities backed by subprime loans were $47.2 billion, of which 99 percent were rated AAA.

Fannie noted its subprime holdings have more favorable credit characteristics than the overall subprime market because 88 percent of subprime loans are credit enhanced, the weighted average LTV is only 79 percent and more than 60 percent of the loans are fixed rate. Additionally, only 8 percent of the loans have an LTV over 90 percent and serious delinquency was 4.80 percent.

Based on its total book of business, 5 percent had credit scores under 620 and the estimated weighted average mark-to-market LTV ratio was 64 percent, the second quarter data indicated. Loans with LTVs over 90 percent were 9 percent of the total book, while the estimated weighted average mark-to-market LTV ratio was 83 percent.

Loans with LTVs over 90 percent and FICOs under 620 represented just 1 percent of the conventional single-family mortgage credit book of business, Fannie reported.

Fannie Sr. Vice President Michael A. Quinn issued a letter to approved sellers indicating a new representation and warranty will require sellers to comply with federal regulatory subprime guidance issued on June 29 as well as comparable state guidance. The modification affects loans with application dates on or after Sept. 13, 2007.

Thursday's SEC filing indicated other non-interest expenses increased by $156 million to $405 million in 2006, mostly the result of higher credit enhancement expense for Alt-A and subprime loans.

Nonprime and Subprime News | Subprime Statistics
Stories about non-QM products. Coverage of subprime, Alt-A and
hard money lending. Home-equity loans and home-equity lines of credit.

SUBSCRIBERS: Edit Subscription | Subscription Help | or call 214.521.1300

Subscribe Contact Us Site Map

Copyright © 2017 Mortgage Daily, D a l l a s
Subsribers Only:

AMC directory

ARM indexes

mortgage company directory

mortgage regulations

net branch directory

p r i c i n g engine directory

wholesale lender directory

More Mortgage News Resources (full site map):

advertising news

appraisal news

bank news

biggest lenders

commercial mortgage news

corporate mortgage news

credit news

FHA news

financial regulation news

foreclosure news

GSE news

jumbo mortgage news

interest rates

loan modification news

loan originator survey

LOS Newsletter


mortgage associations

mortgage-backed securities

mortgage books

mortgage brokers

mortgage compliance

mortgage conferences

mortgage directories

mortgage education

mortgage employment

mortgage employment index

mortgage executives

mortgage fraud

mortgage fraud blog

mortgage fraud local news

Mortgage Fraud Index

Mortgage Graveyard

mortgage insurance news

mortgage lawsuits

mortgage leads

mortgage lender ranking

mortgage licenses

mortgage litigation

Mortgage Litigation Index

Mortgage Market Index

mortgage mergers

mortgage news

mortgage politics

mortgage press releases

mortgage production

mortgage public relations

mortgage rates

mortgage servicing

mortgage statistics

mortgage technology

mortgage video

mortgage Webinars

net branch

net branch directory

nonprime news

origination news

originator tools

real estate news

refinance news

reverse mortgage news

secondary marketing

social media

servicing news

subprime news

wholesale lenders