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News Release

FHFA Updates Progress on Fannie Mae and Freddie Mac Credit Risk Transfer Programs

FOR IMMEDIATE RELEASE
3/29/2018

Washington, D.C. – The Federal Housing Finance Agency (FHFA) today issued a Credit Risk Transfer Progress Report describing the status and volume of credit risk transfer (CRT) transactions through the fourth quarter of 2017.  The Report provides a comprehensive picture of how Fannie Mae and Freddie Mac (the Enterprises) transfer a substantial portion of credit risk to the private sector through a variety of transactions in the single-family market.

The Report shows that since the start of the CRT programs in 2013 through the end of 2017, the Enterprises have transferred a portion of credit risk on approximately $2.1 trillion of unpaid principal balance (UPB) with a combined Risk in Force (RIF) of about $69 billion.

The Progress Report also shows that, in 2017:  

  • The Enterprises transferred risk on $689 billon of UPB with a total RIF of $20.6 billion. Debt issuances, like Structured Agency Credit Risk (STACR) and Connecticut Avenue Securities (CAS), accounted for 69 percent of RIF; 
  • Freddie Mac expanded its STACR program to a new series of STACR debt notes, called SHRP. SHRP notes are backed by loans that meet the Home Affordable Refinance Program eligibility criteria and have mark-to-market loan-to-value ratios between 60 and 150 percent, allowing Freddie Mac to transfer risk on some of its most seasoned loans.
  • Both Enterprises executed front-end CRT transactions – transferring risk at the time the mortgages were acquired – with forward commitments, and utilizing reinsurers and affiliates of mortgage insurance companies.

"The Enterprises continue to make tremendous progress with credit risk transfer as they benefit from strong private sector market demand," said FHFA Director Melvin L. Watt.  "This report reaffirms our steadfast commitment to reduce risk to taxpayers and to do so in a transparent way that continues to attract and expand private sector investment."

Progress Report

Credit Risk Transfer webpage

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The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 11 Federal Home Loan Banks. These government-sponsored enterprises provide more than $6.0 trillion in funding for the U.S. mortgage markets and financial institutions. Additional information is available at www.FHFA.gov, on Twitter @FHFA, YouTube and LinkedIn.
Contacts:

Media: Corinne Russell (202) 649-3032 / Stefanie Johnson (202) 649-3030
Consumers: Consumer Communications or (202) 649-3811

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