GSE Sees New Business Slip to Lowest Volume in 18 Months

GSE Sees New Business Slip to Lowest Volume in 18 Months

10/28/2013 BY: TORY BARRINGER

September marked the third straight month of declining business for Freddie Mac, with purchases and issuances coming in at their lowest level in a year and a half.

Freddie Mac’s total mortgage portfolio shrank at an annualized rate of 4.3 percent in September, contracting at a slightly lessened pace compared to August’s -5.0 percent growth rate. Through September, 2013’s average monthly growth rate has been -2.0 percent.

As of September 30, Freddie Mac’s portfolio has contracted through six of the year’s first nine months. By the end of the month, its ending balance stood at $1.927 trillion.

New business fell for the second straight month to a 2013 low, with purchases and issuances totaling approximately $28.2 billion—the lowest since April 2012 ($25.9 billion). Year-to-date, new business has totaled $382.5 billion.

Multifamily new business volume was $1.0 billion in September and $18.8 billion for the year’s first nine months.

The GSE’s portfolio of mortgage-related securities and other guarantees took a downturn after improving in August, shrinking for only the third time this year at a rate of 0.2 percent.

Single-family refinance loan purchase and guarantee volume was $16.4 billion, representing 62 percent of total single-family purchases or issuances—another signal of the fading interest in refinances. Relief refinance mortgages made up 39 percent of the mortgage giant’s single-family refinance volume.

The company’s single-family seriously delinquent rate dropped to 2.58 percent, continuing the declining trend in delinquency rates. The multifamily delinquency rate was flat at 0.05 percent.

Freddie Mac reported 6,685 loan modifications in September, totaling 60,431 for the year so far.

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