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Press Release​s​

Ginnie Mae Streamlines Requirements for Servicers Moving Homeowners from Forbearance to Permanent Loan Modification
Contact: Douglas Robinson
(202) 475-7818
Published Date: 1/21/2022 4:30 PM

WASHINGTON, D.C. – Ginnie Mae announced today in All Participants Memorandum 22-01 (APM 22-01) that it is streamlining its documentation requirements for servicers participating in the Federal Housing Administration (FHA) Advanced Loan Modification (ALM) program. This step will eliminate the requirement for recordation and title insurance as described in more detail below. The new policy, effective for all ALMs, including those already in process or completed, supports the Biden-Harris Administration’s goal of assisting homeowners impacted by the pandemic on the road to economic recovery. This step helps create more efficiency so that servicers/issuers can help more homeowners transition from forbearance into a permanent modification.

In earlier actions developed to help homeowners transition from forbearance, Ginnie Mae in November expanded the use of digital signature for mortgage modifications, and in December guaranteed the first MBS pools comprised of extended term mortgages up to 480 months that increase affordability for qualifying homeowners.

“In order to fully stabilize the economy, servicers need as many tools as possible to help homeowners recover from the pandemic’s economic effects,” said Ginnie Mae President, Alanna McCargo. “This policy gives issuers clear guidance on how to move forward to help tens of thousands of FHA homeowners coming out of forbearance benefit from the FHA Advance Loan Modification.”

Under the streamlined policy, the issuer is required to provide the following documentation to the Document Custodian: 

  1. Original fully executed Loan Modification Agreement, signed by all borrowers, and in recordable form. 2
  2. If the Issuer determines recordation is necessary to maintain an enforceable first lien position, or if the loan modification agreement contains assignments of leases or rents provisions, the modification must be recorded for final certification. 
  3. If the modification is recorded, the Issuer must also comply with the title insurance requirements in Chapter 24, Part 2, §A(2), as well as obtain the necessary title policy or endorsement, and subordination(s) as indicated on title. 
  4. The modified loan file must clearly identify for the document custodian that it is an ALM.

Document custodians will not be required to verify that the ALM is recorded, unless the loan modification agreement contains provisions for assignment of leases or rents, or title insurance is present. However, if the ALM loan modification agreement is recorded, title insurance that meets the requirements of Chapter 24, Section 2 is required.

More details regarding the new streamlined policy can be found in APM 22-01 and in the relevant sections of the Ginnie Mae MBS guide.

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 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 Department of Housing and Urban Development’s 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.