HUD Secretary Announces New Program to Help Smaller Lenders Access Ginnie Mae

During a prepared speech at the Mortgage Bankers Association’s annual National Policy Conference in Washington, the US Department of Housing and Urban Development secretary Shaun Donovan said that starting in October or November, Ginnie Mae will allow lenders to securitize single loans and issue pool on a daily rather than a monthly basis.

“This will help smaller lenders access Ginnie Mae and FHA directly,” said Donovan. Typically Ginnie Mae issuers are large banks and has put smaller lenders at a disadvantage. During the speech, Donovan gave few details on the new Ginnie Mae program, but did say it has the technology and ability to allow lenders to deliver single loans that would eventually be pooled with other loans into a Ginnie Mae security.

Whether or not the new program would include the increasingly popular reverse mortgage MBS program that has taken off in the past year is unclear. Ginnie Mae has yet to respond to our request for comment.

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FHA Commissioner David H. Stevens told the Washington Post that the single loans will be mixed into a pool of loans from multiple lenders. The policy changes will give smaller institutions “more flexibility and a competitive role in the lending process,” Stevens said.

The idea sounds great, but how it becomes a reality is unclear to me. According to our sources, Ginnie Mae hasn’t approved a new HMBS issuer in the last year, so how this is executed will be very interesting.

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  • I like the idea but cannot understand how it would be implemented. If the loans are going to be purchased by GNMA on a “onesy and twosey” basis, the seller has to have the capability of servicing an HMBS (or hire a subservicer), right?

    And if these loans are subsequently placed in a pool at a later date, along with with multiple other sellers, who would be the Issuer?

    Lots of details left out of the explanation of this new concept.

  • I like the idea but cannot understand how it would be implemented. If the loans are going to be purchased by GNMA on a “onesy and twosey” basis, the seller has to have the capability of servicing an HMBS (or hire a subservicer), right? rnrnAnd if these loans are subsequently placed in a pool at a later date, along with with multiple other sellers, who would be the Issuer?rnrnLots of details left out of the explanation of this new concept.

  • Aren’t there a tremendous amount of requiremnets to get approved as a Ginnie Mae Issuer? How will the small mortgage bankers even qualify?

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