Ginnie Mae Introduces Revised HMBS Pooling Eligibility Guidelines

In a significant development, Ginnie Mae has recently unveiled its revised eligibility requirements for HECM Mortgage Backed Securities (HMBS) pooling, aiming to facilitate the securitization of multiple participations tied to a specific HECM within a single issuance month. The move is part of Ginnie Mae’s strategic efforts to alleviate liquidity pressures on HMBS Issuers and maintain the viability of the HECM program.

Effective from October 1, 2023, the revised HMBS pooling eligibility guidelines, outlined in All Participant Memorandum (APM) 23-11, impose specific criteria on participations to be considered for pooling:

1. Sequential Participations: All participations must be sequential in nature.
2. Single Participation per HECM: Only one participation per Home Equity Conversion Mortgage (HECM) is permissible per HMBS.
3. Prior Pooling Requirement: Any previous pools containing participations linked to a particular HECM must have been issued before additional participations can be submitted.
4. Additional Requirements for Non-First-of-the-Month Disbursements: In cases where the participation arises from a HECM disbursement on a day other than the first day of the month, additional specific requirements, as outlined in APM 23-11, must be met.

Ginnie Mae’s decision to revise these HMBS pooling eligibility criteria underscores its commitment to enhancing the functionality of the HECM program and ensuring its continued sustainability.

Stay tuned to Reverse Mortgage News (RMN) for more updates on this development and its implications for the reverse mortgage industry.