Freddie Mac reports recurring developments tied to U.S. housing finance, mortgage liquidity and its role as the Federal Home Loan Mortgage Corporation. Company news commonly covers the Primary Mortgage Market Survey® for conventional conforming mortgage rates, quarterly financial results, monthly volume summaries and activity across mortgage-related portfolios, securities issuance, delinquencies, debt activities and risk management.
Freddie Mac also reports capital markets activity connected to its Single-Family credit risk transfer programs. Updates include STACR® Structured Agency Credit Risk notes, ACIS® reinsurance transactions and tender offers for certain STACR securities, reflecting the company’s use of private capital markets to transfer residential mortgage credit risk.
Freddie Mac has released a new white paper that introduces an innovative methodology for identifying economic opportunity areas for very low-, low-, and moderate-income renters. The research employs a hybrid of the Opportunity Atlas and a proprietary Location Score to assess locations based on rental performance and income mobility. The findings align with the Federal Housing Finance Agency's definitions but also reveal additional areas with potential opportunity, emphasizing a continuum view of housing opportunities.
On October 27, 2022, Freddie Mac (OTCQB: FMCC) reported the 30-year fixed-rate mortgage averaged 7.08%, the highest since April 2002, causing stagnation in the housing market. Chief Economist Sam Khater noted that ongoing inflation and rising costs are diminishing consumer confidence, leading potential homebuyers to delay purchases, thereby pushing demand and home prices lower. Additionally, the 15-year fixed-rate mortgage averaged 6.36%, while the 5-year ARM averaged 5.96%. Freddie Mac is improving its data collection methods, with changes effective November 2022.
Freddie Mac (OTCQB: FMCC) published its Monthly Volume Summary for September 2022, detailing its mortgage-related portfolios, securities issuance, risk management, delinquencies, and debt activities. Since its establishment by Congress in 1970, Freddie Mac has played a crucial role in making housing accessible and affordable for millions of families. The report highlights the company's ongoing efforts to build a better housing finance system for homebuyers, renters, lenders, and taxpayers.
Freddie Mac (FMCC) announced the pricing of its second Seasoned Loans Structured Transaction Trust (SLST) offering for 2022, totaling approximately $230 million, which includes $201 million in guaranteed senior certificates and $29 million in non-guaranteed subordinate certificates. This securitization aims to manage credit and market risk by reducing less-liquid assets in its portfolio. The transaction is set to settle on October 31, 2022, backed by 1,326 seasoned loans, none of which are over 150 days delinquent.
Freddie Mac Multifamily awarded BH Management Services as its 2022 Impact Sponsor of the Year for outstanding contributions to affordable housing and tenant advocacy. This recognition highlights BH's commitment to sustainability, diversity, and community development. Managing approximately 100,000 units and owning 50,000, BH utilizes Freddie Mac’s initiatives for reporting on-time rent payments, enhancing residents' financial stability. The award emphasizes a dual mission of profitability and social impact, setting a commendable industry standard.
Freddie Mac (OTCQB: FMCC) has enhanced its Condo Project Advisor tool to streamline the loan origination process for condominium projects. The updated functionality allows lenders to request an automated Project Assessment Request (PAR) to determine project eligibility quickly. This enhancement aims to improve efficiency in financing condominiums, which are essential for affordable housing. By providing actionable insights on project compliance, lenders can focus their reviews and potentially lower risks associated with condominium unit mortgages. This feature is available to authorized lenders starting October 24, 2022.
Freddie Mac (OTCQB: FMCC) recently released its Quarterly Forecast indicating a downturn in the housing market due to rising mortgage rates and decreased demand. The 30-year fixed-rate mortgage is predicted to average 5.4% in 2022 and 6.4% in 2023, up from 3.0% in 2021. Home price growth is expected to slow significantly, from 6.7% in 2022 to -0.2% in 2023. Home sales are also forecasted to drop from 5.8 million in 2022 to 5.1 million in 2023, reflecting a decline in mortgage origination levels, projected at $1.9 trillion in 2023, down from $4.8 trillion in 2021.
On October 20, 2022, Freddie Mac (OTCQB: FMCC) reported a slight increase in 30-year fixed mortgage rates, averaging 6.94%. This marks a rise from last week's 6.92% and significantly up from 3.09% a year ago. The report indicates declining housing market demand and diminished homebuilder confidence, which has dropped to 50% of its peak six months prior. The 15-year fixed mortgage also rose to 6.23%, while the 5-year ARM fell slightly to 5.71%. Upcoming changes to the PMMS will enhance data collection, effective November 2022.
Freddie Mac (OTCQB: FMCC) announced an innovative lending capability that enhances homeownership opportunities by integrating borrowers' bank account data into its Loan Product Advisor (LPA), effective November 6, 2022. This industry-first approach evaluates positive monthly cash flow to better assess a borrower's payment ability, making it easier for first-time and underserved borrowers to qualify for loans. Lenders can submit data from various accounts, ensuring that it only enhances the credit risk assessment. Supported by third-party service providers, this initiative aims to modernize the mortgage process and improve borrower experiences.
On October 13, 2022, Freddie Mac (OTCQB: FMCC) announced the final tender results of its offer to purchase all STACR (Structured Agency Credit Risk) Notes. As of 5:00 p.m. on October 12, approximately $944 million in Notes were validly tendered. The settlement date for these transactions was also October 12, 2022. This offer was executed in line with the conditions set in the Offer to Purchase, dated October 3, 2022. BofA Securities, Inc. and Barclays Capital Inc. acted as lead dealer managers for the offer, which is part of Freddie Mac's ongoing efforts to manage credit risk in the housing market.