Ginnie In Brief
|Fiscal Year 2020 Surges to Second Highest First-time Homebuyer level in Five Years|
|by Ginnie Mae | 11/20/2020|
For the fourth time in five years, Ginnie Mae and its insuring and guaranteeing partners have financed homeownership for more than 900,000 first-time homebuyers. Fiscal year 2020 was the second highest total in five years at 965,115, coming just short of the 2017 high-point of 975,340 and significantly higher than the 888,437 initial buyers in 2019.
Ginnie Mae attracts capital for mortgage lending facilitated by four government programs: the Federal Housing Administration (FHA); the Veterans Administration (VA), the Rural Housing Service within the U.S. Department of Agriculture (USDA) and lending under the Public Indian Housing (PIH) program within the Department of Housing and Urban Development.
Measured by total loans within Ginnie Mae MBS, FHA was the most frequently used program by first-time buyers in FY 2020 with more than 636,000 mortgages. That is followed by the VA program at 228,148, USDA at 99,220 and PIH at 1,531.
However, as a percentage of each underlying agency’s program, 72 percent of all USDA loans went to first-time homeowners, followed by USDA and PIH each at 44 percent and VA at 19 percent.
|Introducing Capital Markets Live |
|by Ginnie Mae | 10/22/2020|
Ginnie Mae recently launched a new podcast series – Capital Markets Live! The podcast explores issues that affect Ginnie Mae mortgage-backed securities (MBS), with insight from officials within the agency and from market participants. The first episode of Capital Markets Live, hosted by Alven Lam, managing director for International Markets at Ginnie Mae, examines the conditions influencing the performance of Ginnie Mae MBS during the COVID-19 pandemic, featuring analysis from Managing Director and Head of Structured Credit at State Street Global Advisors, Jim Palmieri. Please visit this page to hear the interview and see the presentation.
|Multifamily MBS Volume Sets Record|
|by Ginnie Mae | 8/24/2020|
The Ginnie Mae multifamily mortgage-backed securities (MBS) program is breaking records. Although most of the attention in the mortgage market is on single-family loan volume as mortgage rates achieve historic lows, owners of properties financed through Ginnie Mae multifamily MBS also are taking advantage of record-low rates to refinance their loans and strengthen their portfolios.
Production figures in the first 9 months of FY 2020 have already surpassed FY 2019 totals, with issuance of Ginnie Mae multifamily MBS hitting $23.1 billion between October 2019 and June 2020 compared to $18.4 billion for all of FY 2019.
While low mortgage rates are essential to this trend, owners can take advantage of low rates because of products in the market that meet their needs. For example, in times of economic uncertainty, the FHA product of long term, fixed rate financing becomes more attractive to borrowers, lenders, and investors.
In addition, multifamily Issuers continue to find value across Ginnie Mae’s products that help them reduce the rate on mortgages within Ginnie Mae MBS. Ginnie Mae Issuers utilizing the Interest Rate Reduction product have seen an average interest rate decrease of approximately 69 bps.
The Ginnie Mae Multifamily MBS Program currently relies on 54 Issuers to service 14,692 pools with $126.3 billion in UPB. Most of these Issuers have enjoyed a longstanding relationship with Ginnie Mae and have helped grow UPB from $39.4 billion in December 2008 to $126.3 billion in June 2020, a 223% increase.
Growth in the program over the last 12 years has been critical to facilitating the construction and renovation of Multifamily housing such as apartment buildings, hospitals, nursing homes, and assisted-living facilities. Today, 28 of 54 Issuers service more than $1 billion in UPB, including 6 Issuers that service more than $5 billion in UPB.
|Securities Issuance Stays Strong and Innovations in Multiclass Products Attract New Participants|
|by Ginnie Mae | 5/26/2020|
Ginnie Mae’s investment in operational and program improvement is helping Issuers do business with Ginnie Mae and provide a wider group of investors with the products they demand, strengthening Ginnie Mae’s ability to maintain the flow of affordable mortgage capital to households in the U.S. Ginnie Mae saw record volume in MBS issuance in April, and a new investor type began using a new feature in one of the agency’s multi-class product.
Specifically, more than $63 billion of Ginnie Mae MBS were issued in April, the ninth consecutive month MBS issuance exceeded $50 billion and the second time volume was above $60 billion in a month.
Single-family mortgage rates consistently near-record-low levels since last summer and the scalability of the Ginnie Mae platform to meet market demand have helped fuel Issuance strength in the MBS business. Program innovation in the multi-class segment, particularly in the Platinum product -- which increases administrative flexibility and liquidity for investors holding small dollar sized Ginnie Mae MBS -- has driven issuance in that product.
Platinum securities volume reached $6.6 billion in April via 30 transactions, up from $4.4 billion and 40 transactions in March. Ginnie Mae’s Office of Capital Markets continues to innovate within its program and work to bring in new types of investors to the Platinum program.
April saw strong issuance of $1.6 billion in the Ginnie Mae Jumbo Only Fixed Platinum option. This option allows Platinum users to bundle Jumbo Fixed pools together and get a pool type assigned reflecting the Jumbo nature of collateral. Having the proper Jumbo pool-type assigned to the security facilitates applying the most accurate prepayment model to the security, enabling better pricing.
April also saw the first HMBS Platinum transactions with adjustable-rate mortgage collateral. Typically, HMBS ARMs are securitized through REMIC transactions, but the new Platinum program innovation now offers another option for investors.
Ginnie Mae REMICS, another multi-class product, also reported strong April volume. Seventeen REMIC transactions were settled in the month for $7.1 billion, compared to 18 deals for $9.8 billion in March.
Overall, the trend in Ginnie Mae securities is positive, illustrating the agency’s strong commitment to meeting the needs of Issuers, investors, and to the ultimate benefit of the homeowners and renters who rely on a steady supply of mortgage capital.
|Ginnie Mae’s Role in Facilitating Rural Homeownership|
|by Ginnie Mae | 3/23/2020|
As Ginnie Mae’s role in the housing finance system has grown since the 2008 housing crisis, it has generated a significant amount of attention for its support of affordable housing through the Federal Housing Administration (FHA) and Veterans Affairs (VA) mortgage programs. Less known, though, is Ginnie Mae’s role in facilitating affordable mortgage lending in rural parts of the U.S.
Ginnie Mae is an essential and consistent source of mortgage capital in communities all across the country, including approximately 2.1 million outstanding mortgage loans in rural areas at the end of 2019.
While most observers readily connect Ginnie Mae to the FHA and VA mortgage programs, which are very active in rural areas, few are aware of another aspect of Ginnie Mae’s mortgage-backed securities (MBS) program that facilitates homeownership in rural parts of the United States.
Ginnie Mae’s charter enables it to guarantee MBS that are backed by loans guaranteed by the Rural Housing Service, a unit with the U.S. Department of Agriculture (USDA). Mortgages financed through the USDA’s Rural Housing Service support a variety of programs. In the last 10 years, more than 1.3 million of these loans and mortgages on residential homes have been packaged into Ginnie Mae MBS.