FHFA

If rising flood waters were the right analogy last time around, this time a tsunami is probably a more accurate description of the wave of delinquencies about to come.

A bipartisan group of lawmakers wrote in a letter to the Treasury secretary that the Financial Stability Oversight Council should create a liquidity facility to deal with a flood of forbearance requests brought on by the coronavirus pandemic.

Mark Calabria needs to be working to secure a Fed facility for servicer advances and to support, not denigrate, smaller servicers, the Mortgage Bankers Association said.

The coronavirus relief legislation could result in private mortgage insurers having to hold more capital, a B. Riley FBR analyst report said.

Federal Housing Finance Agency Director Mark Calabria said a virus-induced financial crisis might give rise to more delinquencies and foreclosures than the 2007 subprime mortgage meltdown.

Mortgage servicers need direction from federal agencies on how to implement the forbearance plans called for in the CARES Act, according to the Community Home Lenders Association.

The impending wave of loan delinquencies because of the coronavirus hurt private mortgage insurer earnings, but the companies will still have sufficient capital, a Keefe, Bruyette & Woods report said.

Treasury Secretary Steven Mnuchin reiterated Thursday that he wants U.S. financial markets to remain open even as the coronavirus fuels wild volatility, while adding that he's focused on helping mortgage firms expected to be hit hard by the pandemic’s spreading economic pain.

With economists fearing high unemployment stemming from the pandemic, the housing finance system is grappling with how it will recoup lost revenue from delinquencies, forbearance plans and other tremors.

The Federal Housing Finance Agency authorized the government-sponsored enterprises to lend additional support to the mortgage-backed securities market and temporarily allow some flexibility in lending requirements to address coronavirus-related concerns.

Mark Calabria said Fannie Mae and Freddie Mac are currently equipped to handle elevated delinquencies, but they might need congressional or Federal Reserve help if fallout from the coronavirus persists.

As financial hardships mount with the COVID-19 outbreak, Fannie Mae and Freddie Mac released their plans for mortgage borrowers impacted by the pandemic.

A number of proposals have been floated for debt payment holidays and other types of moratoria, but such approaches offer solutions that are worse than the problems.

FHFA Director Mark Calabria said the health crisis will complicate the release of a proposal establishing new capital requirements for Fannie Mae and Freddie Mac.

A proposal to tighten financial requirements for government-sponsored enterprise counterparties that sought to lower risk in a volatile market should be suspended, a group representing smaller lenders said, arguing it would aggravate current distress.

The temporary foreclosure moratorium on loans backed by HUD, Fannie Mae and Freddie Mac comes after lawmakers and housing advocates had pushed for steps to avoid consumers getting booted from their homes.

The agencies were up and running Monday but have taken steps to allow employees to work from home.

A national moratorium would be costly to lenders and servicers, but proponents say it's needed to help cushion the economic blow of the pandemic.

Fannie Mae and Freddie Mac coming out of conservatorship and transitioning into public utilities would be the ideal for small mortgage lenders, according to trade-organization representative Robert Zimmer.

Sen. Mark Warner led a group of Democratic senators in calling on bank, credit union and GSE regulators to give detailed instructions on helping consumer and commercial borrowers hurt by the COVID-19 outbreak.