Gnma hmbs program

Figures 3 and 4, below, show the trend of participation composition by number of participations and UPB over time. These reflect the shift toward ARM lines of credit and away from fixed-rate lump sum disbursements illustrated in Figures 1 and 2.

One of these files contains fixed-rate and annually adjusting rate loans, and the other contains monthly adjusting rate loans. Because individual security participations are spread across several different pools often with several column values repeating for a single loan working with this dataset can be challenging. An example of a single loan spread across multiple security participations is illustrated in the table below.

Table 1 The most important risk factors associated with HECMs relate to borrower mortality and mobility i. Borrowers are more likely to move out of their homes for health reasons as they age, but they become less likely to move out for other reasons. Having more than one borrower tends to extend the life of a HECM because the loan does not become due until the last surviving borrower leaves the property. As noted earlier, loans must be purchased out of the HMBS once they reach this threshold.

Because interest is deferred in HECM loans, it is added to the opening balance. We calculate the total prepayments and obtain the single monthly mortality to calculate the CPR. Figure 5, below, shows the one-month CPR by vintage over the past five years. Figure 5 Because borrower mortality and mobility tend to remain stable over time, HECM prepayment speeds exhibit less variability than traditional mortgages do. You may be trying to access this site from a secured browser on the server.

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Borrowers who have selected payment plan options other than the Single Disbursement Lump Sum, may change their plans at any time, and request advances in varying amounts at varying times in the future. The varied timing and amounts of borrower requested advances introduce the potential for excessive levels of interest rate risk, as well as the possibility that economic obligations from risks would be assumed by Ginnie Mae in the event of an Issuer default.

Consequently, Ginnie Mae is prohibiting the pooling of such loans. Moreover, Ginnie Mae will monitor Issuers who retain such loans outside of Ginnie Mae pools, to the extent that interest rate risk could impact the issuers' capacity to meet their obligations for pools backing Ginnie Mae-guaranteed securities.

However, this prohibition will not extend to pooling Participations related to these loans, provided that the related HECM loan was pooled in a security with an Issue Date prior to June 1,