Industry groups partner with Fannie, Freddie to develop single security

Advisory group formed to help build common securitization platform

A consortium of industry groups are partnering with Fannie Mae, Freddie Mac, and Common Securitization Solutions to further the development of the Common Securitization Platform and the single security.

Freddie, Fannie and CSS, the company formed last year by Fannie and Freddie to facilitate the design and implementation of the single GSE bond through the Common Securitization Platform, announced the formation of an industry advisory group to “provide feedback and share information” on the development of the CSP and the single security.

According to the joint announcement, the members of the CSP advisory group are:

  • The Center for Responsible Lending
  • Financial Services Roundtable
  • Fixed Income Clearing Corporation
  • Mortgage Bankers Association
  • Independent Community Bankers Association
  • American Bankers Association
  • Securities Industry and Financial Markets Association
  • Structured Finance Industry Group

The single security is a joint initiative of Fannie and Freddie to develop a single mortgage-backed security that will be issued by the GSEs to finance fixed-rate mortgage loans backed by one- to four-unit single-family properties.

The CSP is a technology and operational platform that is being developed by CSS. CSP will perform many of the core back office operations for the single security, as well as most of the GSEs' current securitization functions for single-family mortgages.

In a statement, SFIG’s executive director, Richard Johns, said the group is “delighted” to join the CSP advisory group.

“SFIG is delighted to be invited to participate in the industry advisory group, and has been supportive of its creation since our first comment letter to the Federal Housing Finance Agency on these initiatives,” Johns said. “Such an alignment of interests among Congress, the industry, the FHFA and the GSE’s will ensure that each stakeholder has the ability to voice their opinions throughout the entire development process of the Single Security and CSP.”

In May, representatives from the FHFA, Fannie, Freddie and CSS said that industry input is important to the development of the single security.

Speaking at the “Update on the GSE Single Security and Common Securitization Platform” panel at the Mortgage Bankers Association’s National Secondary Market Conference, CSS’ chief executive officer, David Applegate, said that before the single security is released, CSS will communicate a timeline eventually and will give lenders and others in housing finance ample lead time to adjust any processes that may need to be customized to the CSP or the single security.

3d rendering of a row of luxury townhouses along a street

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