FHFA Releases 2016 Scorecard for Fannie Mae, Freddie Mac

The Federal Housing Finance Agency yesterday released its 2016 Scorecard outlining priorities for Fannie Mae, Freddie Mac, and their joint venture, Common Securitization Solutions LLC, saying the government-sponsored enterprises “substantially advanced” FHFA’s conservatorship strategic plan in 2015.   

FHFA said the 2016 Scorecard (http://www.fhfa.gov/AboutUs/Reports/ReportDocuments/2016-Scorecard.pdf) further goals outlined in FHFA’s Strategic Plan for the Conservatorships of Fannie Mae and Freddie Mac, published in May 2014. These goals include:  

–Maintain, in a safe and sound manner, credit availability and foreclosure prevention activities for new and refinanced mortgages to foster liquid, efficient, competitive and resilient national housing finance markets;

–Reduce taxpayer risk through increasing the role of private capital in the mortgage market; and

–Build a new single-family securitization infrastructure for use by the Enterprises and adaptable for use by other participants in the secondary market in the future.  

“The progress Fannie Mae and Freddie Mac made in 2015 substantially advanced the goals set forth in our Conservatorship Strategic Plan and we expect to build on this progress in 2016,” said FHFA Director Melvin Watt. “The new Scorecard will guide Fannie Mae, Freddie Mac and Common Securitization Solutions as they continue working to foster liquidity and access to credit for creditworthy borrowers in the national housing finance markets in a safe and sound manner.”  

Mortgage Bankers Association President and CEO David Stevens, CMB, issued a statement, sayng from an industry standpoint, the scorecard has “a lot of good news.”

“The scorecard clearly identifies front-end credit risk transfer for single-family loans as a priority and identifies the need to solicit feedback from industry,” Stevens said. “This has been one of our top priority issues and one on which we are eager to continue to engage with FHFA and the GSEs. We are further encouraged by FHFA’s direction to maintain similar levels of multifamily financing and to continue to exempt loans in affordable and underserved market segments from the financing caps.”

In addition, Stevens said  FHFA’s plan to review its estimates of the multifamily loan origination market size on a quarterly basis will help avoid disruptions in the multifamily finance market that could otherwise occur. “We are also pleased with the progress that CSS is making with both the Common Securitization Platform, which Freddie Mac will begin utilizing in 2016 for their existing single-family securities and the Single Security, which is expected to be issued by both GSEs in 2018,” he said. “Finally, we are also pleased that FHFA has pledged active support for mortgage data standardization initiatives, including MISMO, to make sure this complex industry is able to adopt new technologies to better serve customers.”

FHFA said the 2016 Scorecard would be based on the following criteria:  

–The extent to which each Enterprise conducts initiatives in a safe and sound manner consistent with FHFA’s expectations for all activities;

–The extent to which the outcomes of their activities support a competitive and resilient secondary mortgage market to support homeowners and renters;

–The extent to which each Enterprise conducts initiatives with the consideration for diversity and inclusion consistent with FHFA’s expectations for all activities;

–Cooperation and collaboration with FHFA, each other, the industry, and other stakeholders; and

–The quality, thoroughness, creativity, effectiveness, and timeliness of their work products.