FHFA Issues Update on Common Securitization Platform

The Federal Housing Finance Agency yesterday released an update on the Common Securitization Platform to be used for securitization of single-family mortgages by Fannie Mae and Freddie Mac.  

The Update details progress made in development of a new infrastructure for CSP. It includes details on the organizational structure of CSS and various modules that comprise the CSP and its functions. In addition, the Update looks ahead to the anticipated announcement in 2016 of an implementation date for Release 1, initial use of the CSP by Freddie Mac, followed by Release 2 that will enable both Freddie Mac and Fannie Mae to use the CSP to issue Single Securities. The Update also describes ongoing efforts to seek input from industry stakeholders, including formation of a Single Security/CSP Industry Advisory Group.   

“Together, these projects will bring us much closer to the goal of improving the overall liquidity of the mortgage market,” said FHFA Director Mel Watt. “They will also reduce costs for Fannie Mae and Freddie Mac and taxpayers.”  

Developing the CSP is a key goal of FHFA’s 2014 Strategic Plan for the Conservatorships of Fannie Mae and Freddie Mac. The CSP will be a common information technology platform that will use industry-standard software, systems and data requirements and will be adaptable for use by other market participants in the future.

The CSP is being developed by Common Securitization Solutions, a joint venture owned by Fannie Mae and Freddie Mac. CSS will act as each Enterprise’s agent to facilitate issuance of single-family mortgage securities, to release related at-issuance and ongoing disclosures and to administer the securities post-issuance. In addition, CSS is creating the operational capabilities necessary to run the platform.  

A link can be found at http://www.fhfa.gov/AboutUs/Reports/ReportDocuments/CSP-Update-Final-9-15-2015.pdf.

FHFA said it welcomes public input on the Update.