Ginnie Mae HMBS Program Summary

Transcription

1 Ginnie Mae HMBS Program Summary NRMAL Annual Meeting November 4 th 2013 (Data as of September 2013)

2 History of Ginnie Mae s HECM/HMBS Program Key Date Feb s early 2000s Aug Nov Apr Sept Mar Oct June 2011 Sep The Housing and Community Development Act of 1987 established a Federal mortgage insurance program to insure home equity conversion mortgages, to be administered by HUD. FHA starts pilot program and insures its first mortgage in HECM industry grows, as FHA becomes a steady insurer, Fannie Mae a regular investor, and the AARP a major developer and overseer of the product. In 2000 Financial Freedom becomes the largest originator through a merger with Unity Mortgage. Ginnie Mae releases APM to introduce the Home Equity Conversion Mortgage (HECM), Mortgaged- Backed Securities (HMBS) program, effective September , as a new class of Ginnie securities backed by HECM loan participations under the umbrella of the Ginnie Mae II Custom Program The first Ginnie HMBS pool is issued by Goldman Sachs Mortgage Company, with an OPB of $116 million and an original participation count of 995. This pool was, however, terminated in March Lehman Brothers Holdings Inc (#4024) issued the second HMBS pool, which was later terminated. Issuances have continued every month since this issue. HUD releases Mortgagee letter to introduce a new table of PLF (Principal Limit Factors), effectively reducing borrowers principal limit by 10%. Effective October 1, Ginnie Mae suspends approval of HMBS issuers in order to perform a comprehensive review of the risks associated with the HMBS program. HUD announces the HECM Saver, a new reverse mortgage product that eliminates the insurance premium (MIP). HUD lowers the interest rate floor from 5.5% to 5%. Bank of America, Financial Freedom, and Wells Fargo announced they are leaving the HECM program. GNMA releases APM to change the servicing fee margin to bps for all participations issued on and after July In Mortgagee Letter , HUD makes significant changes to HECM program, including but not limited to adding limits to initial disbursements, financial assessment requirements, and adjustments to mortgage insurance premiums. *National Center for Home Equity Conversion. A Capsule History of Reverse Mortgages in the United States *HUD HECM Mortgagee Letter 2

3 HMBS Program: Ginnie Mae s Motivations 1. Support for the FHA HECM Program, in keeping with our mission to facilitate the funding of government-insured mortgage programs through the global capital market. 2. Protection of Ginnie Mae s interests: - Maintain liquid markets for GNMA securities and MSR portfolios - Manage/mitigate counterparty risk 3

4 Issuances 4

5 FY 2013-To-Date Issuances Period Beginning Balance (in millions) Issuances (in millions) Buyouts and Payments (in millions) Ending Balance (in millions) FY2009 $1,052 $5,095 ($20) $6,127 FY2010 $6,127 $11,792 $138 $18,056 FY2011 $18,056 $10,699 ($28) $28,727 FY2012 $28,727 $8,484 ($343) $36,868 FY2013 $36,868 $9,201 ($1,510) $44,559 5

6 Issuer ID Issuer REVERSE MORTGAGE 4015 SOLUTIONS, INC URBAN FINANCIAL GROUP 4132 INC Annual Issuances by Issuer Percentage of Total Volume (OPB Basis): CYTD CY 2013 OPB ($ Millions) CY 2012 OPB ($ Millions) CY 2011 OPB ($ Millions) 32.62% $2,320 $2,569 $ % $1,800 $2,020 $1, LIVE WELL FINANCIAL 14.02% $997 $ GENERATION MORTGAGE COMPANY 9.64% $685 $1,019 $1, NATIONSTAR MORTGAGE 6.23% $443 $544 - AMERICAN ADVISORS 4250 GROUP LIBERTY HOME EQUITY 4136 SOLUTIONS SUNWEST MORTGAGE 4021 COMPANY 4.05% $ % $ % $224 $339 $ BANK OF AMERICA, N.A. 0.92% $66 $103 $1, ONE WEST BANK, FSB 0.20% $14 $24 $ SILVERGATE BANK 0.06% $4 $ METLIFE HOME LOANS 0.00% - $1,318 $2, WELLS FARGO BANK, N.A. 0.00% - $302 $2,202 FINANCIAL FREEDOM % - - $110 SENIOR FUNDING 6 TOTAL % $7,111 $8,593 $9,930

7 September 2013 Issuances Issuer ID Issuer Name Number of Pools OPB ($ Millions) 4015 Reverse Mortgage Solutions, Inc 15 $ Urban Financial Group Inc 12 $ Liberty Home Equity Solutions 6 $ American Advisors Groups, Inc. 3 $ Generation Mortgage Company 9 $ Nationstar Mortgage 17 $ Live Well Financial Inc 8 $ Sunwest Mortgage Company, Inc. 4 $ One West Bank, FSB 1 $1 Total 75 $662 7

8 HMBS September Issuance Activity: Originations and Draws Pool Type New Originations Subsequent Draws Total Originations Participations $ Amount Participations $ Amount $ Amount RF 314 $52,359, ,522 $28,075,287 $80,434,659 ML 4,165 $508,369,645 51,433 $68,205,693 $576,575,338 RM 0 $ - 4,866 $5,118,310 $5,118,310 Total 4,479 $560,729, ,821 $101,399,289 $662,128,307 Pool Types: RF HECM Fixed Rate ML HECM Monthly Adjustable Rate tied to LIBOR RM - HECM Monthly Adjustable Rate tied to CMT AL HECM 1-Yr Adjustable Rate tied to LIBOR RA HECM 1-Yr Adjustable Rate tied to CMT 8

9 HMBS Existing Participation Draw Activity Compared to Buyouts/Payments by Fiscal Year OPB (Millions) $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 FY 2012 FY 2013 Draws Buyouts/Payments 9

10 Portfolio 10

11 Active HECM Portfolio by Issuer Issuer Number Issuer Name Number of Pools UPB ($ Millions) Participation Count 4157 NATIONSTAR MORTGAGE LLC 725 $15,543 1,899, REVERSE MORTGAGE SOLUTIONS, INC 410 $7, , URBANFINANCIAL GROUP INC 338 $5, , WELLS FARGO BANK, N.A. 133 $5, , GENERATION MORTGAGE COMPANY 341 $4, , BANK OF AMERICA 163 $2, , SUNWEST MORTGAGE COMPANY, INC 163 $1, , LIVE WELL FINANCIAL 110 $1,309 68,169 FINANCIAL FREEDOM SENIOR FUNDING CORP/ 4148 ONEWEST BANK 124 $829 79, AMERICAN ADVISOR GROUPS 14 $288 2, LIBERTY HOME EQUITY SOLUTIONS 35 $261 3, SILVERGATE BANK 4 $24 1,106 Total 2,560 $44,559 4,384,935 11

12 HECM/HMBS Portfolio Growth The HECM/HMBS portfolio has grown steadily since the program began. In September, the portfolio UPB increased 1.1% to $44.6 billion. Total participations increased 3.6% to 4,384,935. Total UPB (Millions) $50,000 $45,000 $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 Number of Participations 5,000,000 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000, ,000 0 Portfolio UPB # Participations in Portfolio 12

13 HECM UPB as a Percentage of Maximum Claim Amount Thirty-seven percent of the HECM loans had UPBs greater than 75% of the Maximum Claim Amount, while fifteen percent were below 50% as of September SEPTEMBER 2011 SEPTEMBER 2013 HECM UPB as a % of Maximum Claim Amount HECM Loan Count % of All Loans HECM Loan Count % of All Loans < 25% 13,224 7% 14,738 5% 25% - 50% 20,844 11% 27,489 10% 50% - 75% 114,137 62% 130,614 48% 75% - 85% 28,112 15% 75,097 27% 85% - 95% 7,216 4% 23,606 9% 95% - 98% 610 0% 2,850 1% >= 98% 0 0% 3 0% Total 184, % 274, % Note: Bottom cutoffs of the stratum are inclusive. For example, 75% - 85% means >= 75% and < 85% 13

14 Ginnie Mae 2014 HMBS Themes 1. Need to accommodate what will be persistent growth of the HMBS portfolio - Natural forward momentum of the HMBS portfolio - Possible extraordinary production 2. Need to tackle deferred programmatic issues - Emphasis on issuer liquidity and sale treatment 3. Focus on industry capacity - Capital - Servicing 14