Freddie Mac’s Mortgage Portfolio Sees Eighth Straight Month of Expansion

money-fourMonthly expansion of Freddie Mac’s total mortgage portfolio was rare from 2010 to 2014. With the release of the Enterprise’s September 2015 Monthly Volume Summary on Thursday, Freddie Mac’s total mortgage portfolio has expanded for eight months in a row and 13 of the last 15 months.

The total mortgage portfolio expanded at a compound annual rate of 3.1 percent in September, the highest rate of the year for any one month. Overall for the first nine months of 2015, the portfolio has expanded at an average rate of 1.5 percent. It has expanded for eight consecutive months following January’s contraction at a rate of 0.8 percent. The 3.1 percent annual rate of expansion in September translated to an over-the-month increase of $5.01 billion up to approximately $1.931 trillion.

With that expansion of the total mortgage portfolio came a drop of four basis points in the serious delinquency rate for loans backed by Freddie Mac, down to 1.41 percent—a year-over-year decline of more than half a percentage point, from 1.96 percent in September 2014. By comparison, the serious delinquency rate on Freddie Mac-insured loans at the start of the crisis in November 2008 was 1.52 percent. The national serious delinquency rate reported by CoreLogic for August was 3.5 percent, nearly two full percentage points higher than Freddie Mac’s rate.

Freddie Mac’s total mortgage portfolio has expanded only 20 times in the last 69 months dating back to January 2010 despite September’s increase. At the beginning of the 15-month period (July 2014) that saw 13 months of expansion, the portfolio was valued at $1.895 trillion. It has expanded by about $36 billion since then.

The number of homeowners with Freddie Mac loans who received permanent loan modifications in September (4,283) increased slightly from August’s total of 4,137. To date in 2015 through the end of September, 43,079 homeowners with Freddie Mac-insured loans have received a permanent loan modification—an average of about 4,787 per month. This average is down by about 800 from 2014’s monthly average of 5,596.

The aggregate unpaid principal balance (UPB) of Freddie Mac’s mortgage-related investments portfolio declined by approximately $2.7 billion in September, while single-family refinance loan purchase and guarantee volume totaled $12.1 billion in September, down substantially from $13.8 billion in August and July’s total of $20.2 billion.

The percentage of single-family refinance loan purchase and guarantee volume that comprised the total single-family mortgage portfolio also took a big drop from August to September, from 50 percent to 41 percent. In May, the share was 61 percent. Relief refinance mortgages comprised about 13 percent of all of Freddie Mac’s single-family refi volume during September, up from 10 percent in August.

To view the complete 2015 Monthly Volume Summary for September, click here.

10-29 Freddie Mac graph


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