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Turning the Tide in Title

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62 | Th e M Rep o RT O r i g i nat i O n s e r v i c i n g a na ly t i c s s e c O n da r y m a r k e t SECONDARY MARKET LocaL edition ima sold msr Portfolio Fannie Mae is selling its Mortgage servicing rights to the tune oF $1 billion. washington D.c. // As the second quarter comes to a close, a new $1 billion Fannie Mae bulk residential mortgage servicing rights (MSR) portfolio has hit the market. The announcement of the sale was made by Interactive Mortgage Advisors (IMA), which is acting as the exclusive broker. The company describes the offering as "an excellent opportunity to focus and bid on newly originated MSRs with below-market interest rates." According to IMA, the weighted average note rate for the portfolio is 4.11 percent. Other quality characteristics include a wide geographic dispersion, zero delinquencies, a weighted average loan-to- value ratio of 72 percent, and a weighted-average FICO score of 745. The servicing is a portion of recent originations from the seller, which IMA describes as a "well-known, established mortgage company with strong financials and [a] solid reputation." All written bids for the offering should be emailed by June 25 at 2 p.m. Eastern, IMA said. Prospective purchasers must be approved Fannie Mae servicers or have a structure in place with an approved servicer who can take ownership and service on their behalf. Fed stays on track with Bond Purchases the "tapering" continues unabated despite unMet expectations. washington D.c. // The Federal Open Market Committee (FOMC) concluded its June meeting with the announcement that members have once again voted to bring down the Federal Reserve's stimulative monthly asset purchases. Taking a cue from improvements in labor market indicators, household spending, and general economic activity, the committee members voted to reduce the Fed's monthly purchase of agency mortgage- backed securities (MBS) to a pace of $15 billion per month, while purchases of longer-term Treasury securities will be cut to $20 billion per month. Together, the cuts represent a scaling back of $10 billion in monthly additions, keeping with the committee's pace so far. If the current course continues, the so-called "taper" could conclude by fall. However, the FOMC points out that "asset purchases are not on a preset course, and ... will remain contingent on the committee's outlook for the labor market and inflation, as well as its assessment of the likely efficacy and costs of such purchases." Despite seeing overall improvement in the economy, board members did readjust their economic projections in light of recent news of a downturn in the first quarter. For 2014, the committee now projects a 2.1–2.3 percent change in real gross domestic product (GDP), a sharp drop from March's projection of 2.8–3.0 percent growth. On the other hand, labor forecasts were more favorable. By the end of the year, the committee—perhaps encouraged by recently improved jobs numbers—expects the unemployment rate to be as low as 6.0 percent. In a press conference following the release of the committee's statement, Fed Chair Janet Yellen explained that the revision comes as a result of better-than-expected payrolls, which have averaged 234,000 over the last three months. Yellen also addressed the role that the regulatory environment has played in this year's slowdown in the housing market, admitting that banks have grown increasingly reluctant to lend to borrowers with lower credit scores. "They mention in meetings with us consistently their concerns about putback risk, and I think it is difficult for any homeowner who doesn't have pristine credit these days to get a mortgage," she said, adding that regulators now need to work to clarify mortgage lending rules "to create an environment of greater certainty for lenders to be willing to extend mortgage credit." Markets responded largely positively to the announcement and to Yellen's conference. As of 2:30 Central on the day of the release, the S&P 500 was up 0.6 percent for the day and was on pace for a record closing. FHFa report Highlights Progress, concerns at gses the conservatorship oF Fannie and Freddie is coM- ing to an end, but there are still probleMs to ad- dress. The Federal Open Market Committee (FOMC) concluded its June meeting with the announcement that members have once again voted to bring down the Federal Reserve's stimulative monthly asset purchases.

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