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Mortgage

Ginnie Mae tweaks re-pooling rules

Seasoning requirement for servicers will drop from six months to three months

Ginnie Mae President Alanna McCargo on Monday announced changes to the re-pooling seasoning requirement for re-performing loans, which it says will increase issuer liquidity.

The government mortgage insurer will shorten the seasoning requirement from six months to three months and allow issuers the option to pool re-performing loans into TBA-eligible Ginnie Mae II Multi-Issuer Pools.

The changes will take place no later than the end of the first quarter of 2023, McCargo told attendees at the Mortgage Bankers Association annual conference in Nashville on Monday.

The policy change reverses a number of temporary pooling restrictions placed on re-performing loans introduced during the pandemic in 2020.

“We have received the future authority program and feedback on the complexities associated with these goals, especially in this rising rate environment,” McCargo said. “The early buyout activity during the pandemic has largely subsided, given the higher interest rate environment that we’re in, and the transition that we’ve seen in delinquencies. So I urged my team to think hard about how we can get our mark on the future of this pandemic program.”

McCargo also spoke to Ginnie’s announcement on Friday that it would be pushing back its risk-based capital requirements for nonbanks by one year to Dec. 31, 2024.


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The RBC requirement itself has not changed, she said, but rather, the extension provides industry stakeholders additional time to adapt to the new framework.

“It is important to know that the implementation extension is for the risk-based capital requirements,” McCargo said in Nashville, adding that all other liquidity and network requirements remain unchanged.

“That additional time based on the feedback we’ve heard from our updated standards will strengthen the sustainability of MBS ecosystem [and] promote durable access to credit for the underserved and protect borrowers from volatility in markets,” she said.

Industry trade groups applauded by the move on Monday.

“Today’s announcement enhances the ability of Ginnie Mae servicer/issuers to help borrowers struggling to make loan payments, by giving issuers more flexible tools to re-pool the underlying loans,” the Community Home Lenders of America said in a statement.

On Monday, HousingWire published a deep dive into the mortgage servicing rights landscape and the growing concern some industry players have regarding Ginnie Mae securities.

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