Author:

Andrew Leventis, Principal Economist

The Brief assesses recent data on home price movements and labor market conditions. Measured over the most recent four quarters, statewide home price appreciation is shown to be only weakly related to growth in employment and personal income. Statistics reveal that recent home price appreciation is much more closely correlated with the prior year’s home price appreciation than with recent labor market outcomes.

The purpose of this white paper is to describe a proposed framework for both a new securitization platform and a model Pooling and Servicing Agreement as set forth in the February 2012 Strategic Plan for Enterprise Conservatorships (Strategic Plan) published by the Federal Housing Finance Agency (FHFA). The Strategic Plan envisions the building and use of a new infrastructure by Fannie Mae and Freddie Mac (the Enterprises) as an efficient, logical extension of existing FHFA initiatives aligning the standards and practices of the Enterprises.

​In January 2012, FHFA released the analyses the agency had conducted since December 2010 on the feasibility and benefit of principal forgiveness as a loan modification tool. This paper presents the agency’s most recent work, which considers subsidy payments2 the Department of the Treasury would provide to Fannie Mae and Freddie Mac (the Enterprises) for reducing principal under the Home Affordable Modification Program (HAMP).

In considering the use of principal forgiveness by Fannie Mae and Freddie Mac (the Enterprises), it is important to place this particular loss mitigation tool in the context of:

• the Enterprises’ overall loss mitigation efforts;

• costs and benefits of using principal forgiveness, including the economic benefit to the Enterprises and taxpayers in general;

• the impact on borrowers’ behavior;

• direct and indirect implementation costs; and

• the overall impact on the mortgage market.

Author:

​​Andrew Leventis, Principal Economist
Forrest Pafenberg, Senior Policy Analyst
Valerie L. Smith, Senior Policy Analyst

​This Federal Housing Finance Agency (FHFA) research paper reviews developments in the housing sector and mortgage markets and the activities of Fannie Mae, Freddie Mac, and the Federal Home Loan Banks in 2008. The paper is part of FHFA’s ongoing effort to enhance public understanding of the nation’s housing finance system.

Author:

​Charles A. Calhoun, Senior Economist

Author:

​Saty Patrabansh

Under the changes to the Home Affordable Refinance Program (HARP)^[1] announced late last year, borrowers with loan-to-value (LTV) ratios greater than 125% will now have the opportunity to refinance. In addition, these changes provided pricing incentives for borrowers to choose a shorter term mortgage.

This Mortgage Market Note provides a simple example to illustrate outcomes for underwater borrowers of choosing between two mortgage products:

Author:

Saty ​Patrabansh

Revised 4/11/2011^[1]