Ginnie Mae, FHFA releases updated seller/servicer requirements

To be eligible for Ginnie Mae and GSE loans, issuers/servicers need a net worth base minimum of $2.5 million plus add-ons of 25 basis points for GSE servicing, 35bps for Ginnie product, and 25bps for private-label and other servicing loans. Tangible net worth or total assets must be greater than or equal to 6%.

The agencies are also aligned in allowing a significant portion of the unused committed agency servicing advance lines of credit to count toward base liquidity requirements – a move the Mortgage Bankers Association was pleased of.

“We appreciate FHFA and Ginnie Mae for their collaboration on this proposal, which reflects a significant amount of MBA’s feedback to the existing and previously-proposed rules,” MBA president and CEO Bob Broeksmit said. “In addition, the agencies significantly reduced and recalibrated the “origination liquidity” requirements to better reflect expected margin call risk. 

“Importantly, FHFA and Ginnie Mae also extended the implementation timeline to provide servicers sufficient runway to adjust to the new requirements. Other proposed changes that MBA had supported during the comment phase were also preserved in the final rule, including eliminating the procyclical liquidity requirement for nonperforming loans and recognizing differences in remittance types. Finally, we appreciate that FHFA and Ginnie Mae will align most, although not all, of their standards. Additional analysis will be needed to fully assess the impact, and we will work with FHFA and Ginnie Mae to ensure the requirements are properly calibrated.”

Broeksmit added that these requirements play a substantial role in the financial planning and risk management practices of institutions that originate and service GSE- and Ginnie-backed loans.