Breaking News
  • Freddie Mac reports $354M net loss in first quarter

    Freddie Mac reported a $354 million net loss in the first quarter, significantly down from its $2.2 billion net income recorded in the fourth quarter of 2015. The news is a reminder of the GSE's net loss in the third quarter of 2015, which marked the first loss in four years. But despite the news, Freddie CEO Donald Layton remains positive on the results. Click the headline to find out why.

NAR, MBA back proposal to curb private transfer fees

The National Association of Realtors and the Mortgage Bankers Association are backing a proposed rule that will curtail the controversial practice of having homebuyers pay private transfer fees each time a property is resold. This week, both associations came out in favor of the Federal Housing Finance Agency's proposed rule on private transfer fees, which would prohibit government-sponsored enterprises Fannie Mae and Freddie Mac and the 12 Federal Home Loan Banks from investing in mortgages that operate as pseudo-securities. On Wednesday, the American Land Title Association also endorsed the FHFA proposal. The fees take on the form of undisclosed securities by allowing developers to attach private transfer fees to properties, resulting in a new payment each time a property is resold. In some cases, the fees attach to properties for up to 99 years. "As the leading advocate for home ownership, we commend FHFA for the proposed rule to ban private transfer fees, which we believe often decrease affordability, negatively impact equity and provide little benefit to property purchasers," said NAR President Ron Phipps, president of Phipps Realty in Warwick, R.I. "FHFA is taking the necessary steps to ensure that these fees are no longer used to simply generate revenue for investors and private developers." While the rule would end the use of controversial private transfer fees, it would not exclude transfer fees paid to homeowners, condominiums and cooperative associations. The MBA said in a statement it "is concerned that encumbering housing transactions with these types of PTFs will impede the marketability and affect the valuation of properties and thus the value of the loans and securities backed by such loans." In addition, the MBA said the fees "are often not disclosed to homeowners because developers or builders often pay the first fee, exempt the sale to the original homeowner or the fee is hidden." On Feb. 2, the FHFA sent the proposed guidelines to the Federal Register to begin formal rulemaking. Comments will be solicited for the next 60 days. The FHFA issued its initial guidance on the rule in August. Write to Kerri Panchuk.

Reprints

Services Guide

Comments powered by Disqus