Year-to-Date Credit Protection Rises to $196 Billion
Freddie Mac's Single-Family business today announced that its Credit Risk Transfer (CRT) program transferred approximately $2.5 billion of credit risk on $69 billion of single-family mortgages from U.S. taxpayers to the private sector in the third quarter of 2019. This brings the year-to-date total of credit risk transferred to $7.3 billion on $196 billion of single-family mortgages.
"Freddie Mac is committed to the stability of the U.S. housing finance system, and CRT is a key component," said Mike Reynolds, Vice President, Credit Risk Transfer. "We will continue to offer attractive opportunities for private capital to participate in our program as we expand CRT coverage across our book of business."
Through its flagship offerings, Freddie Mac issued a total of six STACR and ACIS transactions in the third quarter--three on-the-run deals (DNA and HQA) and three seasoned deals (ARMR and FTR). As a result of STACR and ACIS on the run transactions this quarter, Freddie Mac transferred between 80 percent (high LTV HQA series) and 90 percent (low LTV DNA series) of the credit risk on the underlying reference pools, helping to reduce capital required under the Conservatorship Capital Framework.
Since the first CRT transaction in 2013, Freddie Mac's single-family CRT program has cumulatively transferred $51 billion in credit risk on nearly $1.4 trillion in mortgages.
International property consultant CBRE is reporting this week that global commercial real estate investment volume in Q4 of 2019, including entity-level deals, was nearly level (-0.5%) with Q4 2018, while full-year volume fell by 2% from 2018.
According to new research by Zillow, the total value of every home in the U.S. is $33.6 trillion, nearly as much as the GDP of the two largest global economies combined -- the U.S. ($20.5 trillion) and China ($13.6 trillion).
Based on research from Learnbonds.com indicates that U.S. mortgage debt is now the highest since the Great Depression in 2008. The outstanding US mortgage debt which has been growing steadily in recent years hit a record high of $15.8 trillion in Q3 2019.