Ginnie Mae Sets Record With Reverse Mortgage MBS

image The Government National Mortgage Association announced that it posted $38.98 billion in total mortgage-backed securities issuance in May. For the first five months of calendar year 2009, Ginnie Mae provided approximately $163 billion of liquidity to the secondary market, compared to nearly $80 billion for the first five months of 2008.

"Our MBS program is continuing to experience phenomenal growth," said Joseph Murin, Ginnie Mae president. "Clearly, as the economy continues to find its footing, there is still a strong need for a safe, dependable security like the Ginnie Mae MBS."

Ginnie Mae’s issued $228 million of HECM MBS in May, the best month on record for the program.  That brings the total to $699 million HMBS YTD.  I’d expect the volume to continue to more lenders turning to Ginnie Mae for their fixed rate HECM.    

Advertisement

ginnie_mae_hmbs

Ginnie Mae Mortgage-Backed Securities Issuance Soars to Nearly $39 Billion in May

Join the Conversation (0)

see all

This is a professional community. Please use discretion when posting a comment.

  • Unfortunately, I think that some of the mid-size originator's barriers to entry on the GNMA program – as it currently exists – will prevent widespread utilization of this program.

    It's a great program, but what most originators don't realize is the level of “back-end” risk that Fannie Mae has always taken on with loans that are sold to them. In a GNMA program, the originator takes on that risk – and has to price the GNMA security to account for it.

    • You raise a good point regarding the substantial risks that remain with the issuer/originator in the GNMA execution. But realistically, there are still very few originators in the reverse mortgage market that fund their own deals anyway, and for most of those the liquidity and economic risks are likely manageable, provided they understand those risks.

      In our experience working with issuers, there is a fairly wide range of expectations regarding the key risk variables, which is generating a significant amount of the volatility we're seeing in the secondary marketplace today. Our expectation is that as we gather additional data this would settle out and become more normalized and manageable – which is why we're building the first industry data repository for reverse mortgages to provide unbiased, comprehensive data to the industry and all interested parties.

  • You raise a good point regarding the substantial risks that remain with the issuer/originator in the GNMA execution. But realistically, there are still very few originators in the reverse mortgage market that fund their own deals anyway, and for most of those the liquidity and economic risks are likely manageable, provided they understand those risks.rnrnIn our experience working with issuers, there is a fairly wide range of expectations regarding the key risk variables, which is generating a significant amount of the volatility we’re seeing in the secondary marketplace today. Our expectation is that as we gather additional data this would settle out and become more normalized and manageable – which is why we’re building the first industry data repository for reverse mortgages to provide unbiased, comprehensive data to the industry and all interested parties.

string(93) "https://reversemortgagedaily.com/2009/06/24/ginnie-mae-sets-record-with-reverse-mortgage-mbs/"

Share your opinion