Freddie Mac is coming to market with two more risk-sharing deals, according to Fitch Ratings.

The Structured Agency Credit Risk Debt Notes, Series 2014-HQ3 and Structured Agency Credit Risk Debt Notes, Series 2014-DN4 are both general unsecured obligations of Freddie Mac, rated ‘AAA’ by Fitch, but are subject to the credit and principal payment risk of a reference pool of residential mortgages held in various mortgage-backed securities guaranteed by Freddie Mac.

Similar to the 2014-HQ2 transaction that closed in September 2014, the HQ3 reference pool consists of $8 billion of loans with loan to value ratios (LTVs) greater than 80% but less than or equal to 95% acquired by Freddie Mac in the first quarter of this years.  The higher LTV loans, which are included in the reference pool, are subject to the same underwriting, quality control (QC) and servicing practices as those with original LTVs (OLTV) below 80%.

The DN4 reference pool consists of $15.7 billion of loans with a weighted average combined loan-to-value (CLTV), debt-to-income (DTI) and credit scores are 76.7%, 34.9% and 753, respectively. All loans were underwritten with full documentation. The reference pool also benefits from significant geographic diversity, with the largest metropolitan statistical area accounting for 5.9%.

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