Freddie Mac is creating a new securitization option for lenders that originate "jumbo/super conforming" fixed-rate mortgages that have a maximum loan limit of up to $729,750.
The new option allows sellers to pack the pools with "jumbo/super conforming" mortgages and exceed the 10% limit on TBA (to be announced) executions.
The new pooling option does not qualify for TBA execution. But it allows sellers to include standard conforming mortgages in the securitizations as well as mortgages with principal amounts above $417,000 and up to 125% of the median house price in jumbo/super conforming pools.
The secondary market agency also said jumbo/super conforming mortgages will be eligible to back Freddie Mac Giant Participation Certificates.
Until December 1, 2010, pools with these prefixes included only Jumbo Conforming mortgages authorized under The Economic Stimulus Act of 2008 and were labeled as Jumbo Conforming. After December 1, 2010, pools with these prefixes also will include Super Conforming and other high-balance loans authorized under the Housing and Economic Recovery Act of 2008 and other legislation and base conforming loans. After December 1, 2010, these pools will be re-labeled by Freddie Mac as Jumbo/Super Conforming.
