1. National Conference of State Housing Boards Educational and Development Workshop

2. Why Securitize? Risk Transfer/Diversification

3. Why Securitize? Risk Transfer/Diversification Transactional Scale Standardization Market Liquidity

4. HFA Single-Family Secondary Mortgage Markets Tax-Exempt Housing Bonds (Whole Loans, MBS) “TBA” Market for GNMA/FNMA/FHLMC Securities Whole Loan Cash Sales to Loan Aggregators Taxable Housing Bonds Private Placement of MBS Hold in Portfolio

5. Single-Family Funding Components – 2015 Estimates (Dollars)

6. Tax-Exempt Housing Bonds – Whole Loans

7. Tax-Exempt Housing Bonds – MBS

8. TBA Market (To Be Announced Market) “TBA” is used to indicate that the investor is acquiring some portion of a pending mortgage pool of as-yet unspecified mortgages, which will be specified at a given delivery date.

9. TBA Market What Sellers and Investors Know: Guarantor (GNMA, FNMA, FHLMC) Settlement Date Security Coupon Rate Mortgage Interest Rate Range Investment Amount Eligible Mortgage Loans (FHA, VA, etc.)

10. TBA Security Issuance Process

11. TBA vs. Bonds Loan Pricing

12. Pricing Screen Example

13. TBA vs. Bonds Loan Pricing Transaction Size and Costs Risk Management

14. Risk Management: Loan Pipeline Risk – Interest Rate Risk Tax Compliance Risk Credit Risk Loan Prepayment Risk Process Execution or Business Risk

15. TBA vs. Bonds Loan Pricing Transaction Size and Costs Risk Management Cash Flow Management Approval as a Seller Servicer Economic Benefits for HFA

16. Questions