Posts Tagged ‘government sponsored enterprise (GSE)’

Freddie Mac securitized financing for Manufactured Home Communities

December 2nd, 2014 Comments off

Freddie Mac LogoMitchell Resnick, vice president of Freddie Mac Multifamily Capital Markets said: “We are proud to announce our first ever K-Deal that includes a loan backed by a manufactured housing community asset.”

MHProNews  has learned from Marketwired  that the non-recourse loans use Structured Pass-Through Certificates (“K Certificates”), multifamily mortgage-backed securities. The Government Sponsored Enterprise (GSE) expects to do 1.1 billion in K Certificates (“K-041 Certificates”). They will be priced the week of December 1, 2014. Settlement is expected around December 16, 2014.

In addition Resnick said: “Freddie Mac’s new MHC offering was announced earlier this year and is already bearing fruit. By adding MHCs to our loan products, we are bringing new liquidity and needed competition to the MHC space. Many of these communities are an important source of affordable housing in their markets.”

Among the factors considered in the loan, per Freddie Mac’s website, are:

  • The percentage of homes owned by the borrower, borrower-affiliate, or third-party investor cannot exceed 25% in aggregate.
  • Homes must conform to the requirements of the federal Manufactured Home Construction and Safety Standards Act of 1974 (HUD Code Standards).

The K-041 Certificates are available via a syndicate led by Wells Fargo Securities, LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated as co-lead managers and joint book runners. Barclays Capital Inc., Guggenheim Securities, LLC, Morgan Stanley & Co. LLC and Stern Brothers & Co. will serve as co-managers. ##

(Logo credit: Freddie Mac)

joseine-josie-thompson-writer-daily-business-news-mhpronews-com50x50-Article submitted by Josie Thompson to – Daily Business News – MHProNews 


Road to Housing Recovery Lengthening

December 6th, 2011 Comments off

A CNNMoney article by Joshua Steiner and Allison Kaptur warns prospective real estate investors that the rosy 2012 forecast for the housing market has two pronounced thorns. The first is less than five percent of the mortgage purchase volume is in the hands of private investors. Support for the housing market from the government is very near its limit. But without that support, private lenders will seek higher down payments and less credit risk, which will decrease demand and cause home prices to fall more. Falling prices will turn investors away, creating a downward spiral. Secondly, the Obama administration is not currently promoting new housing initiatives. Both leading Republican contenders, Newt Gingrich and Mitt Romney, say the housing market needs to hit bottom and clear on its own. The authors note the failed leverage of the National Association of Realtors (NAR), the National Association of Home Builders (NAHB), and the Mortgage Bankers Association (MBA) to get increased GSE loan limits extended suggests the government may have reached its housing industry support limit.

MH Field Hearing Yields HUD, MHI, Industry, and Resident Viewpoints

November 30th, 2011 Comments off

At the “State of the Manufactured Housing Industry” Congressional Field Hearings in Danville, Virginia, Nov. 29, members of the House Congressional Subcommittee on Housing, Insurance, and Community Opportunity heard from a variety of persons in the MH arena.

Henry Czauski, Acting Deputy Administrator for the Office of Manufactured Housing programs, noted the affordability aspect of Manufactured Housing (MH) to moderate and low-income families. He stressed the importance of federal regulations in ensuring MH is built to standards that enhance the safety and security of the structure, and the involvement of the Manufactured Housing Consensus Committee (MHCC) in that process. Noting that the “certification” fees HUD collects on each MH section has declined with the decrease in sales, he said Congress has appropriated funding to supplement these fees in three of the last four years.

Kevin Clayton, president and CEO of Clayton Homes, and secretary of the Executive Committee for the Manufactured Housing Institute (MHI), testified that 72 percent of all new homes sold in 2010 under $125,000 were manufactured homes. While noting that the industry as a whole provided 75,000 full-time jobs in 2010, 200,000 jobs have been lost as the industry has declined. Clayton said provisions of the Dodd-Frank Act will disparately impact manufactured home lending, that the SAFE ACT, now under the auspices of the Consumer Financial Protection Bureau (CFPB) needs clarification in its implementation, and that HUD’s outdated building codes and guidance on preemption have left the industry vulnerable to state and local regulators.

Tyler Craddock, of the Virginia Manufactured and Modular Housing Association, said manufactured housing comprises 5.6% of all the housing in Virginia, but in many rural areas where construction labor is not readily available, 15-20% of the housing is MH. Craddock said factory-built housing sales are moving more in the direction of modular in his area, and blamed the lack of affordable financing for consumers wanting to purchase manufactured housing.

Adam Rust, research director of the Community Reinvestment Association of North Carolina, noting the difficulty in obtaining financing for MH, said a person applying for a manufactured home loan is three times more likely to be turned down than someone applying for a site-built home loan. Rust said GSEs could be restructured to make financing more available to persons buying manufactured homes, because interest rates are too high and consumer protection is too low. He also suggested making funds available for community groups to buy MHCs.

Stanley Rush, of MHD Empire Service Corporation, says SAFE Act implementation is hurting MH salespeople who are only helping consumers with paperwork, not with lending decisions. With so many sources of lending drying up because regulators are encouraging lenders to stay away from MH loans, the industry is being further crippled, Rush stated.

J. Scott Yates, president of Yates Homes of Pittsylvania County in Virginia, testified his company has dropped to five employees from 19, and from selling 180 homes a year to only 30. Yates said he is now selling modular homes to keep his company alive because the codes are the same for site-built homes and financing is easier to obtain. He said the big loser is the American consumer of more modest means.

MH Virginia resident Carla Burr said she could only afford her $113,000 home because she had sold her condo and had the cash. Her other option was to finance the home at 10 percent, despite a good credit rating, a figure she says prevents many people from being able to afford MH. She said not only does the government need to promote manufactured housing through the myriad of programs already existing, but it also needs to protect community residents who sometimes are at the mercy of unscrupulous community owners.

MHARR provided written testimony for the committee.

(Editor’s Note: The full written portion of the statements from each of the above are available for your download and reading here below).

Mr. Henry S. Czauski, Acting Deputy Administrator for Manufactured Housing Program, U.S. Department of Housing and Urban Development

Mr. Kevin Clayton, President and Chief Executive Officer, Clayton Homes, Secretary for the Executive Committee of the Manufactured Housing Institute (MHI)

Mr. Tyler Craddock, Executive Director, Virginia Manufactured and Modular Housing Association

Mr. Stan Rush, Account Representative, Haylor, Freyer and Coon, Inc.

Mr. J. Scott Yates, President, Yates Homes

Mr. Adam Rust, Research Director, Community Reinvestment Association of North Carolina

Ms. Carla Burr, Manufactured Housing Resident

Written Testimony submitted by Danny Ghorbani for the Manufactured Housing Association for Regulatory Reform (MHARR)

(Graphic credit: Wikipedia  U.S. House of Representatives)

GSE’s Delinquency Rate Rises Slightly

November 25th, 2011 Comments off

HousingWire reports Freddie Mac’s seriously-delinquent mortgage rate inched up 0.03 percent in October over Sept. to 3.54 percent. Meanwhile, the multi-family delinquency rate dropped to 0.31 percent from Sept.’s 0.33 percent. The overall mortgage portfolio at the government-sponsored enterprise (GSE) fell at an annualized rate of 5.22 percent last month. Representing 72% of the GSE’s total mortgage portfolio purchases and issuances, single-family refinance, loan purchase and guarantee volume reached $24.1 billion in October. Freddie Mac modified 105 more loans in October over September, hitting 6,571, bringing this year’s total to 96,697.

(Graphic image: Freddie Mac)

Bonuses for GSE Heads Topic of Congressional Hearings

November 14th, 2011 Comments off

HousingWire reports that the heads of Fannie Mae and Freddie Mac will face questions from Congress regarding the bonuses they received last year. Fannie CEO Michael Williams and Freddie CEO Charles “Ed” Haldeman each earned a base salary of $900,000 but according to the Securities and Exchange Commission filings, received $2.3 million in bonuses. The top ten executives at both companies earned combined bonuses of almost $13 million while the two GSEs (government-sponsored enterprises) owe the Treasury Department $151.7 billion. Senate Banking Committee Chairman Tim Johnson (D-S.D.) has called a hearing for Federal Housing Finance Agency acting director Edward DeMarco to testify about approving the bonuses. Earlier, DeMarco has said the bonuses help retain talent at the GSEs.

(Graphic credit: FHFA)

Senate Bill Would Downsize Fannie and Freddie in Ten Years

November 10th, 2011 Comments off

NationalMortgageNews states Sen. Bob Corker (R-Tenn.) has introduced legislation to wind down Fannie Mae and Freddie Mac’s share of the mortgage market to ten percent in ten years. The bill would go into effect six months after its passage. It also calls for the credit guarantee the GSEs provide mortgage backed security (MBS) investors reduced to 90 percent. “We are no closer to transitioning Fannie Mae and Freddie Mac off government life support than the day the firms were taken under direct government control in 2008,” Sen. Corker said. In a bi-partisan move, Sen. Kay Hagan (D-N.C.) and Sen. Corker are co-sponsoring a bill to create a covered bond market in the U.S., much like the ones in Europe. “The U.S. lags behind its global peers in the development of a covered bond market because we lack a legislative framework for issuers and investors,” Sen. Hagan said. “With a legislative framework in place, U.S. financial institutions will have a powerful tool that can be used to fund loans to small businesses and households.” Senators Chuck Schumer, (D-N.Y.) and Mike Crapo, (R- Idaho), also are co-sponsoring the covered bond bill.

(Photo credit: Wikipedia/Fannie Mae HQ Washington, D.C.)


GSE Execs Get Bonuses; Senate Chagrined

November 4th, 2011 Comments off

NationalMortgageNews reports the Senate Banking Committee wants to know why government sponsored enterprise (GSE) executives are receiving millions of dollars in bonuses while the government is keeping the mortgage giants afloat. Since the Federal Housing Finance Agency (FHFA) took over the GSEs in Sept. 2008, the FHFA has propped them up to the tune of $169 million in assistance. “Earlier this week, it was reported that 10 executives at Fannie Mae and Freddie Mac were scheduled to receive bonuses totaling more than $12 million,” Senate Banking Committee chairman Tim Johnson, D-S.D., said Thursday morning. “Given the current economic times and continued challenges in the housing market, I want to assure my colleagues that I plan to call acting FHFA acting director Ed DeMarco before the Committee as soon as possible.” When asked about the bonuses, DeMarco noted the same compensation packages have been used since 2008, and that he has testified about this several times before Congress.

(Graphic credit: Wikipedia)