Fannie Mae, Freddie Mac Begin Accepting Forward UMBS Trades

Fannie Mae and Freddie Mac yesterday announced they will begin accepting forward Uniform Mortgage-Backed Security trades with a trade date on or after March 12 and settlement dates on or after June 3.

The common single mortgage-backed security, known as the UMBS, is part of the Single Security Initiative, a new securitization infrastructure for Fannie Mae and Freddie Mac for mortgage loans backed by single-family properties. Common Securitization Solutions, a joint venture owned by the Fannie Mae and Freddie Mac, developed a Common Securitization Platform under direction of the Federal Housing Finance Agency, as well as operational capabilities necessary to run the CSP.

The announcements follow confirmation on March 7 from the Securities Industry and Financial Markets Association that its To-Be-Announced Guidelines Advisory Council approved revisions to good delivery guidelines for the UMBS. The SIFMA guidelines allow for forward June UMBS trades to be filled with existing Fannie Mae TBA-eligible MBS, or UMBS issued in June.

The SIFMA Decision Summary can be found at

Under the SIFMA updated Good Delivery Guidelines, UMBS issued by either Fannie Mae or Freddie Mac will be deliverable into UMBS TBA contracts for settlement starting June 3 (

Freddie Mac will no longer issue new Gold PCs with a 45-day payment delay after May 31. Beginning May 7, Freddie Mac plans to offer holders of 45-day, TBA-eligible and non-TBA-eligible PCs and Giants the option to exchange their eligible 45-day securities for 55-day Freddie Mac mirror securities. Freddie Mac’s retained portfolio will book the first exchange transaction in late-March 2019.

Fannie Mae and Freddie Mac said yesterday’s announcements are designed to allow lenders and investors to prepare for the orderly implementation of the UMBS and to ensure transparency.