Ginnie Mae issues new rules for servicers and issuers

Aiming to provide more stability and integrity to the mortgage-backed securities market, Ginnie Mae on Friday released a number of new rules for mortgage servicers and issues of Ginnie Mae securities.

Ginnie Mae, like Fannie Mae and Freddie Mac, is a mortgage bond issuer, but focuses specifically on securitizing pools of government-backed mortgages insured by the Federal Housing Administration, the Department of Veterans Affairs and other agencies.

In the last few months, Ginnie Mae’s portfolio pushed past $2 trillion, comprised of more than 11 million loans.

With a portfolio of that size, Ginnie Mae is taking steps to bring more security to the MBS market. According to Ginnie Mae, the new rules change the application requirements for new issuers.

The changes will also see Ginnie Mae implementing “new notification requirements for issuers engaged in certain subservicer advance or servicing income agreements,” and clarifies Ginnie Mae’s “ability to impose additional financial or operational requirements on program participants when warranted by market conditions.”

Specifically, Ginnie Mae’s new rules:

  • Require servicers to notify Ginnie Mae if any arrangements are made to finance Ginnie mortgage servicing rights, ensuring that Ginnie Mae can adequately monitor risks as they move throughout the system
  • Modify application requirements for new issuers so that applicants who would immediately appear on Ginnie Mae’s internal financial conditions watchlist are not approved as Ginnie Mae issuers
  • Codify Ginnie Mae’s authority to require supplemental financial or operating requirements before certain issuers are granted additional commitment authority

“These enhancements add to the factors Ginnie Mae will consider as we keep pace with an evolving mortgage market, protect taxpayers, and ensure that important differences in risk among issuers and servicers are properly accounted for,” said Michael Bright, Ginnie Mae EVP and COO. “Our goal continues to be the assurance of a safe and sound program as well as a healthy mortgage-backed security.”

To view the new rules in full, click here.

Article source: https://www.housingwire.com/articles/47430-ginnie-mae-issues-new-rules-for-servicers-and-issuers

Leave a Reply

WP Facebook Auto Publish Powered By : XYZScripts.com
Bunk Beds