Treasury Secretary Steven Mnuchin recently commented on mortgage-finance giants, Federal National Mortgage Assctn Fnni Me(OTCMKTS:FNMA) and Federal Home Loan Mortgage Corp(OTCMKTS:FMCC), and noted that overhauling the mortgage financing system is crucial.
Mnuchin stated, “We are committed to working with the House and the Senate on having a reform package that makes sure that we promote necessary liquidity in the housing markets.” However, the Treasury Secretary noted that the overhaul isn’t a focus in the first half of 2017.
Mnuchin has indicated multiple times that a mortgage-finance system overhaul is a priority in the Trump administration. However, Trump has been more focused on more important matters, such as regulator relief, tax reform and global politics. Now, there are some large investors who have urged President Trump and the Federal Housing Finance Agency to bypass the U.S. Congress to release Federal National Mortgage Assctn Fnni Me(OTCMKTS:FNMA) and Federal Home Loan Mortgage Corp(OTCMKTS:FMCC) from government control. Now, that we’ve gone over the politics surrounding these companies, let’s get into some of their news developments.
Let’s start with Fannie Mae first. Fannie Mae recently earned the 2017 ENERGY STAR Partner of the Year Sustained Excellence Award from the U.S. Environmental Protection Agency (EPA). An ENERGY STAR partner since 2011.
According to Jeffery Hayward, executive vice president of multifamily, Fannie Mae, “Receiving this award for the third year in a row is a testament to our continued innovation and leadership in ensuring greener, better quality and more affordable housing for everyone…We are very proud of the role that we played in creating the Green Multifamily market and it all started with our partnership with the EPA. Creating the ENERGY STAR 1-100 Score to help multifamily owners track and reduce energy consumption of their properties continues to be a game changer for a metrics-driven industry.”
Not only that, but Fannie Mae recently priced its fourth Multifamily DUS REMIC in 2017, which totaled $855.8M under its Fannie Mae Guaranteed Multifamily Structures. According to Josh Seiff, Fannie Mae’s Vice President of Capital Markets and Trading, “We kicked off the second quarter with a $900 million 10-year GeMS deal, which built on the first quarter’s $3.1 billion in issuance…The GeMS program is about matching investor demand with borrowers’ liquidity needs. The investor market has been pretty calm lately, but there’s still consistent demand for well-diversified, block-sized deals.”
Moving on, let’s look at some press releases from Freddie Mac. After mortgage rates fell below 4% recently, Freddie Mac Chief Economist Sean Becketti stated, “”The 30-year mortgage rate fell 11 basis points this week to 3.97 percent, dropping below the psychologically-important 4 percent level for the first time since November. Weak economic data and growing international tensions are driving investors out of riskier sectors and into Treasury securities. This shift in investment sentiment has propelled rates lower.”
Freddie Mac also priced some of its Multifamily K-Deals recently. Freddie Mac priced a new offering of Structured Pass-Through Certificates, also known as K-Certificates, which are multifamily mortgage-backed-securities (MBS). Now, FMCC expects to issue around $790M in K-Certificates, specifically K-1503 Certificates. FMCC also priced a $1B Multifamily K-Deal, K-725. The company expects to issue over $1B in K-725 certificates.
Now, there’s a lot of developments surrounding FNMA and FMCC. With that in mind, you might want to stay up to date on these companies, because they could have some catalysts that could potentially move the stock. We’ll do all the heavy lifting and look into their press releases. All you have to do is enter your email address in the box below, and thereafter, you’ll be subscribed to our free newsletter. Then, we’ll be able to send you recent developments, if any, in FMCC and FNMA.
Disclosure: No one at Street Register has been compensated in any way for the publishing of this article, nor do we hold any position in FMCC or FNMA stock, short or long.