Enact Holdings, Inc. · NASDAQ:ACT
Enact — Investor Presentation (January 2021)
16 slides from Enact's investor presentation, Jan 19, 2021
Slide 1: Beyond the Basics: Freddie Mac and the Secondary Market
Freddie Mac – Genworth Beyond the Basics: Freddie Mac and the Secondary Market Presented By: Sanat Shankardass January 19th 2021
Slide 2: Freddie Mac and Your Mortgage
Freddie Mac and Your Mortgage What is Freddie Mac and what is its role in the housing market? Watch this video and find out how Freddie Mac connects borrowers, lenders and investors from around the world to make home possible for millions of America's families and renters. Freddie Mac | Do Not Distr
Slide 3: Contract System Screenshot
Contract System Screenshot Freddie Mac | Do Not Distribute 3
Slide 4: Contract System Screenshot
Contract System Screenshot Freddie Mac | Do Not Distribute 4
Slide 5: Single-Family Business Framework
Single-Family Business Framework Freddie Mac | Do Not Distribute 5
Slide 6: Delivery Paths into Freddie Mac: Guarantor and Cash Window
Delivery Paths into Freddie Mac: Guarantor and Cash Window What are the delivery paths into Freddie Mac? Guarantor Cash Window Freddie Mac | Do Not Distribute 6
Slide 7: Selling Options/Executions
Selling Options/Executions Choose a cash or securities execution for your mortgages or explore a bulk sale of mortgages you're currently holding in your portfolio. • Sell for Cash: Best Efforts, Mandatory, Servicing-Released, Servicing-Retained, Weighted Average Coupon (WAC) ARM Cash • Swap for Secu
Slide 8: Sell for Cash
Sell for Cash Cash Window: Best Efforts and Mandatory An efficient execution channel that offers customers fast funding and multiple Cash Window / execution types, including “Best Efforts” and “Servicing Released.” Execution Whole Loan Trade. Best Efforts Lock in competitive prices and get cash cont
Slide 9: Sell for Securities
Sell for Securities Take advantage of securities executions in Loan Selling Advisor® where you receive a Freddie Mac Uniform Mortgage-Backed Security (UMBS) which is eligible for a TBA trade or an MBS which you can hold in your investment portfolio Fixed-rate Guarantor Minimum $1 million or more of
Slide 10: Guarantee Fees: Why, What, When
Guarantee Fees: Why, What, When WHY Freddie Mac charges lenders guarantee fees (Gfees) to cover the cost of ensuring that investors will receive timely monthly payments of principal and interest. Freddie Mac ‘guarantees’ the loans backing Participation Certificates (PCs) so investors will not be aff
Slide 11: Delivery Fees: Why, What, When
Our Revenue Components Delivery Fees: Why, What, When WHY Freddie Mac charges lenders delivery fees to cover the cost of more risky loans. Gfee pricing is based on an average ‘vanilla’ credit mix. Delivery fees are targeted supplemental pricing to ensure that all-in costs are covered. WHAT Delivery
Slide 12: Delivery Fees, also Known as Exhibit 19
Our Revenue Components Delivery Fees, also Known as Exhibit 19 Example of current delivery fees: Delivery fee pricing: Non-Owner Occupied (NOO) Cash-Out Refinances Loan attribute cost, competitor A Minus Number (#) of Units price, and Capital Deployment or Balloons with LTVs > 80% Second
Slide 13: Specified Loan Pay-ups
The Start of the Pricing Equation Specified Loan Pay-ups What are “Spec Pay-ups”? Mortgages with specified attributes appeal to investors because of better convexity (slower prepayments) profile. Examples of attributes: • Low Loan Balance (LLB) • Certain Geographies, e.g., New York (NY), Investor Pr
Slide 14: Uniform MBS or UMBS
Uniform MBSSM or UMBS • A new Uniform Mortgage-Backed Security, issued either by Fannie Mae or Freddie Mac. • A single forward TBA (To Be Announced) contract is created for which both Fannie Mae and Freddie Mac UMBS securities will be deliverable. • Freddie Mac will offer investors the ability to ex
Slide 15: Buyups and Buydowns
Buyups and Buydowns • Tool that allow sellers to pool effectively • One of the pricing components of Best Execution • Allows seller/servicers to dynamically manage interest only (IO) risk • Purchase or sale of cash flows for cash up front = NPV (Net Present Value) • Buyup = Freddie pays seller, for
Slide 16: Best Execution Decision / Rate Sheet
Security Dealers Security Prices GFees Buyup/Buydown Originator Freddie Mac BEST EXECUTION Contract Terms Agency Pricing Cash Window MODEL Credit Delivery Fees - LLPA Servicing Released Premiums/Value Servicer Best Execution Decision / Pricing Rate Sheet >>> Determines the Best Execution to sell the
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