Freddie, Fannie updates lead wave of secondary market news

Fannie Mae, Freddie Mac, Vice Capital Markets, Better Mortgage and Wolters Kluwer are among companies adding new secondary market offerings, financing or related technology this week.

Freddie has released two new types of low-loan balance 30-year mortgages that receive cash pay-ups, according to Vice Capital Markets, which has added the products to its system. The company also plans to add new cash pay-ups Fannie has in the works.

The Freddie mortgages, which have maximum balances of $450,000 and $425,000, have been incorporated into secondary market execution workflows lenders use to price and commit loans to the government-sponsored enterprises.

Freddie added the pay-ups for these loan types on Monday, according to a spokesperson. Investors may pay more for certain small loans because historical performance generally shows they are less likely to refinance.

Vice Capital Markets also plans to make products on new 30-year commitment grids currently pending at Fannie immediately available when launched. These include small mortgages that max out the same levels as Freddie's pay-ups, and a manufactured housing loan.

"Speed to market matters in secondary, especially when new execution options become available," Shawn Ansley, chief information officer at Vice Capital Markets, said in a press release.

Better completes warehouse line renewals

In other news, Better Mortgage now has renewed all of its warehouse lines and increased capacity by over $275 million in the last three months, according to information Treasurer Rob Wilson provided in a company press release.

Most recently, Better has raised its total warehouse financing from $750 million to $850 million by increasing its capacity on an existing line, raising it from $250 million facility to $350 million. 

A global investment firm is providing the facility, which Better renewed for a year. Better did not identify the name of the warehouse provider. A portion of the facility has committed terms, which call for the financing to remain in place for the full period so long as requirements are met.

"We are thankful to our lending partners for leaning into and doubling down on Better in a tough macro environment," Vishal Garg, CEO and founder, said in the release.

Garg indicated that improved access to financing and cost of capital are priorities in the company's recent earnings call. 

"We continue to improve our warehouse terms while working to expand capacity to support partnership volume growth," he said. "In parallel, we are working toward a secured tokenized credit facility via stablecoin-ecosystem that we estimate could lower costs by up to 100 basis points."

Wolters Kluwer provides new digital vault visibility

Wolters Kluwer Financial & Corporate Compliance has added new access to its digital vault platform that provides warehouse banks and investors with a broader view of assets pledged to them.

This allows secured parties to get a single view across multiple customer vaults rather than accessing them individually.

Ron Jautz

"The rise in fraud and double pledging has raised the stakes for warehouse lenders and secured parties. They need clear, real-time into the digital lending assets backing their portfolios," said Simon Moir, vice president, lending systems, in a press release.