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All ​Participant Memorandums (APMs)

APMs (All Participant Memoranda) are issued by IPM generally to announce policy and MBS Guide changes accessed by Issuers, Document Custodians and other participants in Ginnie Mae programs.

5 most recent APMS
6/1/2018 - APM 18-05

Periodically, Ginnie Mae implements minor updates to the Mortgage Backed Securities Guide, HUD Handbook 5500.3, Rev. 1 (MBS Guide) to ensure that its policies are clearly and accurately reflected and to notify Issuers about upcoming operational changes. Please note the following announcements.

HMBS Issuers-Revision of the definition of ‘Original Interest Rate’ in Appendix III-28

Ginnie Mae has become aware of confusion about the data that should be reported for the “original interest rate” field in field 9, M01, of Appendix III-28, Form HUD 11705H and HUD 11706H. To ensure clarity and consistency, Ginnie Mae is updating the definition of “original interest rate” as follows. The term “Original Interest Rate” will be revised as “The original interest rate for the HECM loan, as reported at the initial pooling (first Participation).” Appendix III-28 of the MBS Guide has been updated in accordance with this APM and is effective immediately.

List of Acceptable Abbreviations for Custodial Account Titles

Ginnie Mae is publishing a list of acceptable acronyms for use when titling custodial accounts. If an Issuer needs to abbreviate the title of an account, the Issuer may use only the abbreviations approved by Ginnie Mae. The table below contains a list of approved abbreviations for identifying the account type or the Issuer’s legal name, d/b/a name, or business form, as applicable, and is being incorporated into Chapter 16 of the MBS Guide and is effective immediately.

APM 18-05 Chart.png
 

Changes to MBS I ACH Debit Procedures

Historically, Ginnie Mae has processed investor pass through (P&I) obligations for all Ginnie Mae I book entry securities through our Depository, the Federal Reserve Bank of New York (FRB). Effective August 1, 2018, and thereafter, ACH debit processing for all Ginnie Mae I MBS Program securities will be performed by Ginnie Mae’s Central Paying & Transfer Payment Agent (CPTA), the Bank of New York Mellon. The FRB will discontinue ACH debits at the end of July 2018. Consequently, and effective with investor payments beginning August 2018, Ginnie Mae’s CPTA will assume all ACH debit responsibilities for both Ginnie Mae I and II MBS. Upon receipt of all Issuer pass-through payments, the CPTA will wire the funds to the Federal Reserve for distribution to investors.

The CPTA will conduct testing prior to the Ginnie Mae I MBS Program August payment date to ensure that it has the requisite access to debit the corresponding custodial accounts successfully. To ensure a seamless transition, all Issuers participating in the Ginnie Mae I MBS Program must confirm that the Bank of New York Mellon can successfully debit the designated custodial account unimpeded by fraud filters or other limits to the debit process. The ACH Originator ID for the Bank of New York Mellon is 1135160382. Once you have confirmed that your custodial accounts are properly configured, no further action is required unless the prenote test fails and you are contacted by Ginnie Mae or the Bank of New York Mellon. The MBS Guide changes relating to the new ACH Debit process will be published prior to August 2018.

Updated Summary of Addresses

Ginnie Mae has also updated its Summary of Addresses to ensure participants have the most up to date contact information for Ginnie Mae and its agents.

If you have any questions regarding this announcement, please contact your Account Executive in the Office of Issuer and Portfolio Management directly, or at (202) 708-1535.

5/30/2018 - APM 18-04

On May 24, 2018, the President of the United States signed into law the Economic Growth, Regulatory Relief, and Consumer Protection Act (S.2155 / P.L. 115-174). The Act prohibits Ginnie Mae from guaranteeing securities backed by certain loans. As part of the implementation of the prohibition in the “Loan Seasoning for Ginnie Mae Mortgage-Backed Securities” provision in the Act, Ginnie Mae is hereby implementing additional pooling eligibility requirements. The implementation of the Act in the Ginnie Mae multi-class securities program will be addressed in a separate announcement.

New Pooling Eligibility Criteria

Effective with mortgage-backed securities guaranteed on or after June 1, 2018, a refinance loan insured or guaranteed under the United States Department of Veteran Affairs benefit program in chapter 37 of title 38 of the United States Code is eligible for Ginnie Mae securities only if it meets the following condition.

The note date of the refinance loan must be on or after the later of:

a) the date that is 210 days after the date on which the first monthly payment was made on the mortgage being refinanced, and

b) the date on which 6 full monthly payments have been made on the mortgage being refinanced.

Impact on Security Issuances Dated June 1, 2018 or Later

Refinances, including refinances that bear a note date prior to the date of this announcement, that do not meet the condition implemented by the Act and announced in this memorandum are not eligible for inclusion in any new pool or loan package in the Ginnie Mae I or the Ginnie Mae II MBS Program.

Ginnie Mae understands that some Issuers have already certified pools and loan packages for June 2018 issuances, which may contain loans that do not meet the seasoning requirements implemented by the Act and reflected on this memorandum. Ginnie Mae’s Office of Issuer and Portfolio Management will be contacting any impacted Issuers ahead of the June 1st issuance date to provide additional guidance on curing any pools or loan packages that have become defective as a result of the recently enacted statutory prohibition.

Notwithstanding the foregoing, Issuers are required to review and evaluate the eligibility of any VA Refinances submitted with any pools or loan packages scheduled for June delivery or later. Issuers may also contact the Pool Processing Agent, at (800) 234-4662 Option 1, to determine status of pools in the pipeline.

Impact on Security Issuances Dated May 1, 2018 or Earlier

Refinances that do not meet the seasoning condition implemented by the Act and announced in this memorandum remain eligible collateral for securities that were previously issued with a date of May 1, 2018, or earlier, assuming they meet all other pooling and program requirements. The Ginnie Mae guaranty attached to any security issued with a date of May 2018 or earlier is not affected by the Act or this memorandum, even if such security is backed by one or more pools or loan packages containing refinances that do not meet the condition implemented by the Act.

Chapter 24 of the MBS Guide has been amended effective immediately in accordance with this announcement. Ginnie Mae will publish a subsequent memorandum announcing new document custodian certification requirements for VA refinance loans.

Please contact your Account Executive in the Office of Issuer and Portfolio Management directly or at (202) 708-1535 with any questions.

2/1/2018 - APM 18-03

The success of Ginnie Mae’s Mortgage-Backed Securities Program is contingent on the integrity of the collateral backing Ginnie Mae securities and on compliance with the requirements of the insuring or guarantying agencies. Ginnie Mae requires Issuers to ensure that each mortgage backing a Ginnie Mae security has a first lien position at the time of pooling and to provide an approved type of title insurance product for each mortgage submitted for pool certification. Over the last two years, Ginnie Mae has increased the number of acceptable title insurance products for modified mortgages to include ALTA Form Mortgage Modification Policies (MMPs). In contrast, Ginnie Mae has never accepted and does not accept Mortgage Priority Guarantees (MPGs), with the limited exception being announced here. Effective immediately, Ginnie Mae will accept MPGs only for modified mortgages backing securities with issuance dates of January 1, 2016 or earlier. MPGs are not acceptable for securities with issuance dates of February 1, 2016, or later.

Under previous document custody and pool certification requirements, Ginnie Mae prescribed Issuers to provide new title policies or title policy endorsements to satisfy the title insurance requirements for modified mortgages. On February 1, 2016, Ginnie Mae published APM 16-01, which revised the Document Custody Manual (DCM), Appendix V-01 of the Mortgage-Backed Securities Guide, HUD Handbook 5500.3 Rev.1. The 2016 DCM revisions allowed Issuers to satisfy title insurance requirements for modified mortgages by delivering an MMP in lieu of a new title policy or title policy endorsement. The 2016 DCM did not include MPGs as acceptable title insurance products.

Ginnie Mae allowed the use of MMPs to address operational challenges faced by Issuers seeking title policy endorsements for certain modified mortgages. MPGs were not included as acceptable title insurance products in the 2016 DCM, in part, because the coverage provided by MPGs was not standard across the industry and could therefore vary across policy providers.

To ensure the lien position of modified mortgages, and prior to the publication of the revised DCM, some Issuers obtained and provided an MPG for modified mortgages submitted for pooling outside of Ginnie Mae standards. The pools containing MPGs are now subject to pool certification issues related to deficient title insurance documentation.

Certain title insurance companies who provided MPGs to Issuers entered into agreements with Ginnie Mae to address the concern surrounding the potential variances in the coverage provided by their MPG products. In response to these agreements and to provide limited relief to Issuers, Ginnie Mae will accept MPGs, but only for modified mortgages backing securities with issuance dates of January 1, 2016 or earlier. The table below illustrates the types of insurance products that are acceptable for modified loans based on the security issuance date corresponding to each loan.

​Security Issuance Date ​Acceptable Title Insurance Products
​January 1, 2016 or earlier ​New Title Policy
Title Policy Endorsement (ensuring priority over defects, liens, and encumbrances)
ALTA Mortgage Modification Policy (MPP)
Mortgage Priority Guarantee Policy (MPG)
​February 1, 2016 or later ​New Title Policy
Title Policy Endorsement (ensuring priority over defects, liens, and encumbrances)
ALTA Mortgage Modification Policy (MPP)
 

All other Issuer responsibilities relating to pool certification and loan documentation remain unchanged, including an Issuer’s responsibility to obtain and record any subordination agreements necessary to ensure that any modified mortgage submitted for securitization has a first priority position.

The updates announced in this APM are reflected in Chapter 24 of the MBS Guide and in Chapter 3 of the Document Custody Manual and are effective immediately. You may retrieve the updated version of these chapters from Ginnie Mae’s website.

If you have any questions regarding this announcement, please contact your Account Executive in the Office of Issuer and Portfolio Management directly, or at (202) 708-1535.

1/25/2018 - APM 18-02

Ginnie Mae continually monitors Issuer participation in the MBS program, and evaluates the MSR portfolios that result from issuance activity to ensure that these portfolios do not have an impact on either the Issuer or securityholders that is adverse to the interests of the program. Effective immediately, Chapters 3, 5, 9, 10, and 18 of the MBS Guide are being expanded to provide additional information about acceptable risk parameters for an Issuer’s Ginnie Mae portfolio and related consequences of non-compliance with these standards.

The revised Chapter 3 provides examples of instances that Ginnie Mae considers outside of the acceptable risk parameters, and are in violation of Ginnie Mae’s program requirements. If an Issuer violates these program requirements, Ginnie Mae may impose greater restrictions on that Issuer’s participation in the MBS Program, including but not limited to requiring that an Issuer’s high-risk portfolio be recalibrated to fall within the acceptable risk parameters; requiring portfolio diversification; or placing a restriction on an Issuer’s participation in the PIIT program and/or multiple Issuer pools.

Issuers should review the updated MBS Guide chapters attached to this memorandum carefully. This guidance should be the basis for ongoing Issuer review of their MSR portfolios and business practices. Issuers should consult with Ginnie Mae as necessary to ensure that their participation meets standards of acceptability.

If you have any questions regarding this announcement, please contact your Account Executive in the Office of Issuer and Portfolio Management directly, or at (202) 708-1535.

1/5/2018 - APM 18-01

Ginnie Mae is revising the definition for the term “Defective Mortgage” and other clauses in Chapter 14 of the MBS Guide to reflect existing Issuer requirements under the Guaranty Agreement to cure or buy out pooled mortgages that are not insured or guaranteed by an agency of the Federal Government. The revisions announced here also seek to provide Issuers with greater clarity about their options for addressing defective mortgages.

Issuers are reminded to prioritize efforts to cure loan defects that arise from missing federal mortgage insurance or guaranty. Mortgages that are missing federal insurance or guaranty by the deadline for final certification of the related pool or loan package are deemed defective. Therefore, Issuers are required to either obtain the requisite insurance or guaranty or to request approval to buy out these mortgages. The revised version of Chapter 14 of the MBS Guide attached to this memorandum, which is effective upon publication, covers these buyout obligations in greater detail.

The percentage of uninsured and unguaranteed loans in Ginnie Mae pools and loan packages is minimal, typically less than one percent (1%) of pooled loans. The percentage of pooled loans that are missing a federal mortgage insurance or guarantee by the final certification deadline is even lower. Therefore, Ginnie Mae does not expect any related Issuer buyout obligations to have a significant impact on the performance of securities or on the financial position of any Ginnie Mae Issuer. However, Ginnie Mae may, at its own discretion, manage the timing and pipeline of mandatory buyouts through its existing buyout approval process so as to minimize the impact of such buyouts on the Issuer or the related security.

If you have any questions regarding this announcement, please contact your Account Executive in the Office of Issuer and Portfolio Management directly or at (202) 708-1535.


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Last Modified: 6/22/2018 7:48 PM