Ginnie Mae restricts three VA mortgage lenders from its main securities programs
Washington, DC – (RealEstateRama) — In the interest of providing additional clarity and transparency to Ginnie MBS investors, Ginnie Mae is announcing that it has restricted VA single family -guaranteed loans pooled by Freedom Mortgage Corporation (Freedom), SunWest Mortgage Company, Inc. (SunWest), and NewDay USA (NewDay) in Ginnie Mae pools to Ginnie Mae II custom pools only. All three issuers are restricted from including VA single family guaranteed loans in Ginnie Mae I securities or Ginnie Mae II multi-issuer securities.
Freedom and SunWest remain approved Ginnie Mae issuers and remain authorized to pool FHA and RHS single family insured mortgages in all eligible Ginnie Mae pool types. The restriction for both issuers of their VA single family loans to Ginnie Mae II custom pools is effective for July 1, 2018 issuances and concludes with January 1, 2019 issuances.
NewDay remains an approved Ginnie Mae issuer and remains authorized to pool FHA and RHS single family insured mortgages in all eligible Ginnie Mae pool types. NewDay’s restriction to Ginnie Mae II custom pools commenced with its April 1, 2018 issuances and concludes with its October 1, 2018 issuances.
The conclusion date assumes that by the specified date, an issuer has demonstrated, to Ginnie Mae’s satisfaction, that (a) prepayment speeds are substantially more in-line with those of equivalent multi-issuer cohorts, and (b) such improved performance is sustainable.
In accordance with APM 18-02 and Section 3-21 of Ginnie Mae’s MBS Guide, any issuer who produces pools of loans or loan packages that consistently demonstrate prepayment activity that is substantially different from that of comparable loan packages or pools of loans will be contacted by Ginnie Mae for further discussion and review. Any issuers restricted from participation in Ginnie multi-issuer pools may, at Ginnie Mae’s sole discretion, be permitted to again participate in multi-issuer pools once their loan packages or pools of loans perform consistent with comparable loan packages or pools of loans and once they have provided to Ginnie Mae an acceptable plan for achieving and maintaining prepayment speeds consistent with Ginnie Mae’s program requirements.
Issuers with questions or concerns should contact their Ginnie Mae Account Executive. Investors with questions should contact Ginnie Mae’s Office of Capital Markets.
About Ginnie Mae
Ginnie Mae is a wholly owned government corporation that attracts global capital into the housing finance system to support homeownership for veterans and millions of low- to moderate-income homeowners throughout the country. Ginnie Mae MBS programs directly support housing finance programs administered by the Federal Housing Administration, the Department of Veterans Affairs, the HUD Office of Public and Indian Housing and the Department of Agriculture Rural Housing Service. Ginnie Mae is the only MBS to carry the explicit full faith and credit of the United States Government.
Contact: Douglas Robinson
(202) 475-7818
