Fannie Mae announced the execution of its seventh and eighth Credit Insurance Risk Transfer™ (CIRT™) transactions of 2022, transferring $1 billion of mortgage credit risk to private insurers and reinsurers to reduce taxpayer risk by increasing the role of private capital in the mortgage market. Both deals were effective as of June 1.

Since the inception of the CIRT program to date, the GSE has acquired approximately $21 billion of insurance coverage on $709 billion of single-family loans. 

The covered loan pool for CIRT 2022-7 consists of approximately 64,000 single-family mortgage loans with an outstanding unpaid principal balance of approximately $19.8 billion. The covered pool includes collateral with loan-to-value (LTV) ratios of 60.01% to 80% acquired in September 2021.

With CIRT 2022-7, Fannie Mae will retain risk for the first 55 basis points of loss on the $19.8 billion covered loan pool. If the $109 million retention layer is exhausted, 24 insurers and reinsurers will cover the next 335 basis points of loss on the pool, up to a maximum coverage of $664 million.

The covered loan pool for CIRT 2022-8 consists of approximately 43,000 single-family mortgage loans with an outstanding unpaid principal balance of approximately $12.9 billion. The covered pool includes collateral with LTV ratios of 80.01% to 97% acquired between August 2021 and September 2021. 

With CIRT 2022-8, Fannie Mae will retain risk for the first 65 basis points of loss on the $12.9 billion covered loan pool. If the $84 million retention layer is exhausted, 19 insurers and reinsurers will cover the next 275 basis points of loss on the pool, up to a maximum coverage of $354 million.

The loans included in both transactions are fixed-rate, generally 30-year term, fully amortizing mortgages and were underwritten using rigorous credit standards and enhanced risk controls, Fannie Mae said. 

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