The U.S. Department of Housing and Urban Development has begun the process on helping China establish a secondary mortgage market to ultimately securitize residential mortgages. HUD and China's Ministry of Construction have targeted the end of the year for the launch of the pilot project.
The Federal Home Loan Banks of Indianapolis, Cincinnati and Seattle are jointly developing a new secondary market mortgage program. Currently being called the Mortgage Purchase Program, the program has a regional focus and a unique risk-sharing plan, making it distinct from the Mortgage Partnership Finance program in which eight other FHLBanks participate. The program, which has four layers of credit protection, is expected to be tested sometime during the third quarter.