Ginnie Mae Issues $872 Million HMBS in July

Ginnie Mae announced that the corporation issued $37.8 billion in mortgage-backed securities (MBS) in July.

“Continuing increases in Ginnie Mae security issuances is clear evidence of the secondary market’s continued confidence in Ginnie, through all economic environments,” said Theodore Tozer, Ginnie Mae president.

Issuance for Ginnie Mae II single-family pools totaled more than $21.8 billion, while Ginnie Mae I single-family pools were nearly $14.6 billion. Total single-family issuance for July was more than $36.4 billion. Issuance for the Ginnie Mae HECM Mortgage Backed Security (HMBS) was more than $872 million in July. Ginnie Mae’s multifamily MBS issuance was over $1.4 billion.

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The July issuance brought Ginnie Mae’s portfolio to more than $1 trillion in outstanding principal balance, which represents the corporation’s efforts to finance nearly 8 million homes for families across the country. The corporation’s issuance activity during the housing crisis has helped the Obama Administration’s housing stability efforts by pumping nearly $800 billion in liquidity into the U.S. housing mortgage finance market in the past two years.

“As the market continues to stabilize, Ginnie Mae continues to provide much needed liquidity to the mortgage market, valuable MBS returns for investors and low mortgage rates for consumers,” Tozer said Ginnie Mae, with its explicit full faith and credit MBS guaranty, has been fulfilling its Congressionally-chartered mission of ensuring access to affordable housing, as intended.”

Ginnie Mae announced new net worth requirements for single family issuers last week.  Expected to take place in September, net worth requirements will climb from $1 million to $2.5 million plus 1 percent for outstanding MBS of $5 million to $20 million and 0.2 percent for amounts above that.  Ginnie Mae will also require that issuers maintain 20 percent of the net worth in cash or cash equivalents and set a liquid asset requirement for all single family issuers.  The changes will be phased in for all current single family issuers and is designed to ensure issuers have a greater capital cushion to absorb losses.

A spokesperson for Ginnie Mae told RMD the new requirements do not apply to HMBS issuers.  Reverse mortgage lenders are still waiting for the new requirements.

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