Mar 16 2018 46078 1

Mar 16 2018 46078 1

Freddie Mac announces a plan to reduce costs for borrowers

BY DAVE KOVALESKI  |   MARCH 14, 2018   |   FEDERAL
  • Share

  • Tweet

  • Share

  • Share

The government sponsored entity (GSE) Freddie Mac announced that it will be allowed to transfer mortgage-credit risk to the private market, which it said would reduce costs to borrowers.

© Shutterstock

The structure that Freddie Mac will use is called Integrated Mortgage Insurance (IMAGIN). Freddie Mac said it would remove some costs that normally are included in insurance prices.

This structure would take the place of lender-paid mortgage insurance that is currently put on loans when borrowers make down payments of less than 20 percent. This will primarily impact a lot of first-time homebuyers or low- to moderate-income borrowers. For example, a borrower with a 5 percent down payment on a $200,000 home purchase, would save roughly $5,600 over 10 years through this new structure.

It would also reduce Freddie Mac’s counterparty risk by eliminating insurers’ ability to question the validity of a claim when a borrower defaults. Further, this new structure would likely make underwriting the GSE’s loans more streamlined as it eliminates the need for private mortgage insurance company approvals and certifications.

The National Association of Federally Insured Credit Unions, in its principles for housing finance reform, has supported the notion of expanding credit risk transfer transactions to further disperse risk among private investors.


Dareld Phillips CalBRE 01731264 Headshot
Author:
Phone: 916-532-9107
Dated: March 16th 2018
Views: 148
About Dareld: Hi, my name is Dareld Phillips Sr., of “The Phillips Team.” I go by “Coach Dareld.” I do no...

Property Search








RSS Feed

View our latest blog posts in your RSS reader. Click here to access. RSS

Search Blog

Recent Blogs

Hot Home Trend Bringing Back The Brass - By Melissa Dittmann Tracey,
Winning The Real Life Game Of Monopoly - Winning The Real Life Game&
Why We Remember And Honor Memorial Day - Many Americans see Memorial Day
Our First Home - It blows me away how quickly the

Saved Properties

This is a list of your favorite properties. We will email you if a property is reduced or leaves the market.

Click 'Save' to add a property to this list.

Register / Login

New & returning visitors please enter your information to login.

By clicking 'register' you are agreeing to our terms of use & giving us expressed written consent to contact you.

Questions? Comments? Complaints?

This message will go directly to the head of our team.

Location & Address

eXp Realty California - Northern / Central Valley
2603 Camino Ramon Suite 200
San Ramon, CA
925-350-4389