Ginnie Mae to Release Additional Data for HECM Saver Loans

Ginnie Mae said it plans to release enhanced disclosure information on its HMBS program on Wednesday.

The additional disclosure information will include the number of HECM Saver loans and their remaining principal balance (RPB) as well as the HECM Saver RPB as a percentage of the total HECM RPB.

The new information is meant to help investors predict the performance of the underlying mortgage collateral and evaluate how the HECM Saver compares to HECM Standard loans.

“Investors will certainly appreciate the additional information, but ultimately consumers should benefit the most from the more robust disclosures especially in terms of lower financing costs,” said Ginnie Mae President Ted Tozer.  “We believe more detailed and timely disclosure information on this segment of the market should enhance investors’ ability to assess the performance of these securities and allow Issuers to sell their loans into the secondary market for better prices.”

WIth no historical data on how the HECM Saver performs, issuers plan to securitize the loans separately until the market gets more comfortable with the product.

“Investors don’t want the HECM saver co-mingled with the Standard,” said David Fontanilla, Trader at Knight Fixed Income during the National Reverse Mortgage Lenders Association Annual Meeting in New Orleans.  “It’s not a judgement on the product, but its too new for investors to get an idea on how it performs.”

Additional data from Ginnie Mae is one step that will help investors get more comfortable with the product.

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