Hi, I’m Adam DeSanctis. This is the Mortgage Minute, the latest news from the Mortgage Bankers Association. MBA this week proposed the development of a new Ginnie Mae security designed to attract more private capital sources of liquidity to support Ginnie Mae issuers in the event of market stress, Or a severe economic downturn. Our proposal is an early buyout or EBO securitization that would be comprised of non performing FHA, VA, and USDA loans bought out of traditional Ginnie Mae pools. This would provide critical liquidity relief for government servicers by solving for monthly advancing requirements. The EBO security would allow an issuer to sell pools of EBOs to private investors. Who would then receive an accrual of the scheduled, principal and interest payments when the loan is resolved through either the borrower re performing on the loan, or when the loan is foreclosed and goes to claim with FHA, VA, or the Rural Housing Service. Importantly, this approach can be implemented by Ginnie May without any need for federal appropriation or additional authority from Congress, relying entirely on the private capital markets to mitigate operational risk. While IMB servicers are well capitalized through Ginnie Mae’s counterparty standards and have developed enhanced access to diverse funding sources, additional options that can reduce liquidity strains in the event of market stress should be considered. We believe our EBO proposal does just that. To read our white paper on this, go to the Residential Policy Issues page at mba.org. That’s it for this week. Thank you for listening
Adam DeSanctis, VP, Communication at Mortgage Bankers Association
As a strategic public affairs and communications executive with nearly two decades of experience, Adam has deep expertise in strategy, management, and media relations. He is widely considered to be an expert in a variety of communications, including advocacy, brand, executive, crisis, grassroots, and social media. In his career, he has been the MBA spokesperson on a wide variety of real estate research and advocacy-related issues, promoted MBA research and advocacy efforts to financial, political, and trade industry media and on MBA’s social media channels, and secured media opportunities for MBA leadership on key real estate trends and issues, generated media coverage for MBA’s research and data on mortgage applications, credit availability, homebuilder applications, mortgage forbearance/delinquencies, commercial real estate originations, and forecasts, and other industry analysis, developed key strategic initiatives for MBA’s organizational public affairs plan, media relations and member communications support for mPower, MBA’s Opens Doors Foundation and MBA’s Diversity, Equity, and Inclusion programs.