National Mortgage Insurance Corp. has agreed to insure about $5 billion in residential mortgages in its first risk transfer transaction with Fannie Mae, contingent on regulatory approval.
A Fannie spokesperson would not comment on the deal other than to say it is working with its regulator, the Federal Housing Finance Agency, to meet the FHFA’s so-called scorecard goals and that the risk transfer is part of that effort.
The company said the District of Columbia Department of Insurance, Securities and Banking needs to approve the pool policy of insurance in order for the transaction to move forward.
According to NMI, the transaction was offered through a formal bid process to private mortgage insurers that it won.
The transaction has an expected effective date in the third quarter. Sources familiar with the deal said that it has been planned for September.
Freddie Mac earlier this month
