The MPF Government product allows you to sell fixed-rate mortgage loans that are insured or guaranteed by government agencies to your local Federal Home Loan Bank (FHLBank). The loan programs that can be sold under the MPF Government product include:

     FHA

Low down payment options

     VA

Financing and down payment flexibility for military veterans

     RD Section 502

Flexible financing for rural and agricultural areas

     HUD Section 184   

Affordable and flexible financing on Indian/Native American land


The MPF Government product offers you the flexibility to retain the servicing of loans sold to your FHLBank or take advantage of our servicing-released options. When choosing the servicing-released options, you would receive a competitive servicing-released premium from one of the MPF Program's approved servicing aggregators.

Use MPF Government if:

  • You are looking for a competitively-priced government loan investor
  • You are looking to fund loans more quickly and easily
  • You are approved by the applicable government agency to originate and service loans
  • You want a variety of mortgage loan options to meet the needs of your customers
  • You appreciate having maximum flexibility in choosing your servicing and remittance option

How It Works

The FHLBanks are able to offer you competitive mortgage products and pricing through the MPF Program as a benefit to membership. When you sell government loans to your FHLBank, the FHLBank manages the liquidity, interest rate, and prepayment risks of the loans.

Benefits

  • Competitive servicing retained execution
    • Choice of remittace options 
  • Excellent servicing released execution 
    • All-in execution = Asset Price + SRP 
  • Same-day loan delivery and funding 

Depository institutions have no leverage capital or risk-based capital requirements for loans sold under the MPF Government product.*

MPF Gov - Loss Structure
MPF Gov - Loss Structure
Actual/Actual Remittance features an investor reporting and remittance option similar to agency actual/actual and a competitive up-front price. This option is structured so that Participating Financial Institutions transfer funds to their FHLBank non-interest bearing custodial deposit account whenever the collected principal and interest net of servicing fees exceeds $2,500. PFIs will find the actual/actual remittance option particularly attractive if they are knowledgeable in actual/actual investor reporting and they value the ease of operation, they value the up-front price benefit and they are knowledgeable in actual/actual investor reporting.
Characteristics
  • Remittance Amount – Actual P&I collections, less a servicing fee
  • Accounting Cut-Off Date – Falls on the last day of calendar month
  • Investor Reporting – Reports distributed by the fifth business day following the cut-off
  • Remittance Frequency – When collected P&I exceeds $2,500 net of servicing fees, and the account balance on the first business day of the month
Requirements
  • Non-interest bearing custodial P&I account maintained at the FHLBank
  • Electronic investor-reporting
  • Access to the eMPF® website
Actual/Actual Single Remittance offers an alternative option to remit MPF principal and interest. This option features a single monthly remittance with a simple investor reporting process. The single remittance option provides a significant float income benefit for all P&I payments received in an accounting cycle. This float value results from all collections received in a calendar month being remitted on the 18th of the following month. Members will find this program attractive if they value the float income, are new to investor reporting, or prefer a simple remitting process.
Characteristics
  • Remittance Amount – Actual P&I collections, less a servicing fee
  • Accounting Cut-Off Date – Falls on the last day of calendar month
  • Investor Reporting – Reports distributed by the fifth business day following the cut off
  • Remittance Date – Date falls on the 18th of the month following the cut off, or the prior business day if the 18th is not a business day
Requirements
  • Non-interest bearing custodial P&I account maintained at the FHLBank
  • Electronic investor-reporting
  • Access to the eMPF® website
Scheduled/Scheduled Remittance features a competitive up-front price and an investor-reporting concept similar to agency scheduled/scheduled. With the scheduled/scheduled option, scheduled monthly principal and interest is advanced through liquidation and a full month of interest for payoffs and curtailments is paid. Members will find this option attractive if they value the competitive up-front price and if they have experience utilizing this remittance type and sophisticated investor-reporting process.
Characteristics
  • Remittance Amount
    • Scheduled P&I, less a servicing fee (remitted the current month)
    • Unscheduled principal (curtailments and payoffs remitted the month following receipt);
    • 30-days interest expense on payoffs and curtailments
  • Accounting Cut-Off Date – falls on the last day of calendar month
  • Investor Reporting – reports distributed by the fifth business day following the cut-off
  • Remittance Date – date falls on the 18th of the month following the cut off, or the prior business day if the 18th is not a business day
Requirements
  • Non-interest bearing custodial P&I account maintained at the FHLBank
  • Electronic investor-reporting
  • Access to the eMPF® website

MPF Government MBS is an MPF Program government loan product whereby the Federal Home Loan Bank of Chicago purchases government loans from eligible MPF Program participants. The purchased loans will be aggregated and pooled into securities guaranteed by the Government National Mortgage Association (Ginnie Mae). Loans that qualify under this product are fixed-rate mortgage loans insured or guaranteed by the following government agencies:

     FHA  Low down payment options
     VA  Financing and down payment flexibility for military veterans
     RHS Section 502  Flexible financing for borrowers in rural and agricultural areas
 

Use MPF Government MBS if:

  • You are looking for a competitively-priced government loan investor
  • You are approved by the applicable government agency to originate and service loans
  • You want a variety of mortgage loan options to meet the needs of your customers
  • You have experience servicing with scheduled/scheduled remittance or sell servicing to an approved MPF servicer

How It Works

The Mortgage Partnership Finance® Program offers you competitive government mortgage products and pricing as a benefit to membership in an FHLBank. You can choose to retain servicing or sell the servicing and receive a servicing released premium. If you retain servicing, you'll report and remit payments on a scheduled/scheduled basis.

A master commitment specificially for MPF Government MBS is required in order to participate in this product. You would underwrite loans in accordance with applicable government agency guidelines. Our competitive pricing and your servicing expertise (or the servicing released option), allows you to offer your customers access to the best mortgage products in the marketplace today.

Benefits

  • Cash execution – securities pricing
  • Excellent servicing-released execution
  • Same-day loan delivery and funding
  • Depository institutions have no leverage capital or risk-based capital requirements for loans sold under the MPF Government MBS product*
  • Minimal overlays to government agency guidelines
MPF Gov - Loss Structure
MPF Gov - Loss Structure
Scheduled/Scheduled Remittance features a competitive up-front price and an investor-reporting concept similar to agency scheduled/scheduled. With the scheduled/scheduled option, scheduled monthly principal and interest is advanced through liquidation and a full month of interest for payoffs and curtailments is paid. Members will find this option attractive if they value the competitive up-front price and if they have experience utilizing this remittance type and sophisticated investor-reporting process.
Characteristics
  • Remittance Amount
    • Scheduled P&I, less a servicing fee (remitted the current month)
    • Unscheduled principal (curtailments and payoffs remitted the month following receipt);
    • 30-days interest expense on payoffs and curtailments
  • Accounting Cut-Off Date – falls on the last day of calendar month
  • Investor Reporting – reports distributed by the fifth business day following the cut-off
  • Remittance Date – date falls on the 18th of the month following the cut off, or the prior business day if the 18th is not a business day
Requirements
  • Non-interest bearing custodial P&I account maintained at the FHLBank
  • Electronic investor-reporting
  • Access to the eMPF® website