Credit risk transfer and de facto GSE reform
David Finkelstein,
Andreas Strzodka and
James Vickery ()
No 838, Staff Reports from Federal Reserve Bank of New York
Abstract:
We summarize and evaluate Fannie Mae and Freddie Mac?s credit risk transfer (CRT) programs, which have been used since 2013 to shift a portion of credit risk on more than $1.8 trillion of mortgages to private sector investors. We argue that the CRT programs have been successful in reducing the exposure of the federal government to mortgage credit risk without disrupting the liquidity or stability of mortgage secondary markets. In the process, the programs have created a new financial market for pricing and trading mortgage credit risk, which has grown in size and liquidity over time. The CRT programs provide an important building block to help facilitate reform of the U.S. housing finance system.
Keywords: mortgage; securitization; credit risk transfer; Freddie Mac; GSE; Fannie Mae (search for similar items in EconPapers)
JEL-codes: G10 G18 G21 G23 G28 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2018-02-01
New Economics Papers: this item is included in nep-ban and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)
Downloads: (external link)
https://www.newyorkfed.org/research/staff_reports/sr838.html Summary (text/html)
https://www.newyorkfed.org/medialibrary/media/research/staff_reports/sr838.pdf Full text (application/pdf)
Related works:
Journal Article: Credit risk transfer and de facto GSE reform (2018) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:fip:fednsr:838
Ordering information: This working paper can be ordered from
Access Statistics for this paper
More papers in Staff Reports from Federal Reserve Bank of New York Contact information at EDIRC.
Bibliographic data for series maintained by Gabriella Bucciarelli ().