Ginny MaeThe firm manages a portfolio of government-guaranteed forward and reverse mortgage-backed securities (MBS), it announced at a conference this week National Reverse Mortgage Association (NRMLA) The company will release preliminary details of its upcoming home equity-conversion mortgage-backed securities (HMBS) product as soon as next month, the event said.
RMD submitted a request for comment to Ginnie Mae shortly thereafter and received a response on Friday from Sam Valverde, the company’s acting president and spokesman for the NRMLA campaign.
When asked to provide more details about the product, which industry participants are calling “HMBS 2.0,” Valverde reiterated the company’s commitment to the reverse mortgage market in light of recent liquidity challenges and its management of former lenders’ portfolios. promise.
“Ginnie Mae remains committed to stabilizing the government reverse mortgage market,” Valverde told RMD. “We developed the new HMBS program to alleviate liquidity pressures and help ensure our issuers have access to reliable and cost-effective capital markets financing.”
At the NRMLA event, Valverde revealed that the company is developing policies and implementation plans for upcoming products and plans to launch a term sheet that will include a 30-day public comment period expected soon. He added that he expects the product to be launched by the end of the year, but it could be launched earlier.
Since becoming more deeply involved in 2022, Ginnie Mae has been actively communicating with the reverse mortgage industry regarding HMBS issues and related liquidity issues. kind of attitude.
“We look forward to hearing input from industry and key stakeholders on the term sheet we will publish next month,” he said. “The timing of implementation will depend on the feedback we receive, but Ginnie Mae will continue to prioritize [the] develop [of] this show.
HMBS 2.0 is receiving attention from many people inside and outside the reverse mortgage industry. Republican Sen. Mike Braun of Indiana recently sent a letter to Ginnie Mae asking about its handling of the bankrupt lender’s issuer status, seeking extensive information on the development of HMBS 2.0.
These include details such as analysis showing the need for new products in this area; the associated objectives, risks and expected results that such a product may have; how it will impact loans already serviced by the bank federal housing administration and Ginnie Mae; and the costs associated with establishing it.
The product was even mentioned in a recent investor update American Financial (FOA), suggesting that HMBS 2.0 will benefit the company.
“HMBS 2.0 may collapse FOA’s securitization acquisitions of approximately US$630 million [unpaid principal balance (UPB)] and republish these as [Ginnie Mae] securitization, improving liquidity and freeing up working capital,” the company said.
Ginnie Mae announced the development of the product in January. According to the initial announcement, it will allow loans to be taken from the HMBS pool above the existing 98% Maximum Claim Amount (MCA) requirement.
