Advances have been made in establishing a securitization platform that will eventually replace Fannie Mae and Freddie Mac.
A secondary mortgage market infrastructure that is in the process of being built has seen important progress made.
In addition, a similar level of progress has been made in reducing Fannie’s and Freddie’s dominant footprint in the marketplace.
That assessment came Monday from the two government-controlled enterprises’ conservator, the Federal Housing Finance Agency.
A progress report from the regulator indicated that the development and initial testing of a common securitization platform has been moving along.
But before the platform can be fully implemented, the pair of secondary lenders need to make changes to their technology and business processes.
Common Securitization Solutions LLC has formally been established as a joint venture that will own the platform as well as related businesses and operational functions.
FHFA highlighted how Fannie and Freddie have executed multiple risk-sharing transactions totaling more than $30 billion. In addition, the two companies have reduced the less liquid portions of their retained portfolios.
Another accomplishment highlighted by FHFA was the recovery of more than $18 billion in restitution following completed reviews of pre-conservatorship loan acquisitions.
“These accomplishments represent important steps that are helping to bring stability and liquidity to the housing market while also laying the foundation for a future, post-conservatorship housing finance system,” FHFA Acting Director Edward J. DeMarco said in the report. “Much more remains to be done and our work will continue while lawmakers decide a future course.”
