Long-standing plans at Ginnie Mae to enable loan-level servicing transfers in its mortgage-backed securities could move faster this year under its President Joseph Gormley.
"Ginnie Mae is increasing the velocity of the initiative to evolve its security platform from pool-level operation to loan-level," the government guarantor wrote in its annual report, calling this "the biggest change to the platform since Ginnie Mae issued the first MBS in 1970."
The government guarantor had
A complex change with potential payoffs
The Department of Housing and Urban Development affiliate's platform was set up such that the servicer for a pool of loans had to be one entity, so the project involves changing a standard deeply rooted throughout Ginnie's systems.
"This shift is fundamental in program operations and requires a steady and methodical approach to ensure no disruptions to the market," the report states.
While difficult, the change could accommodate more bifurcation of Ginnie's mortgage servicing rights within a single pool, such as situations where banks want to exclude customer MSRs from a sale. Ginnie's latest annual report suggests more granular data would improve accuracy.
"The net effect of this transition will provide more precision cashflow tracking for managers and investors, more effective prepayment, delinquency, and loss mitigation modeling, error reduction and, we believe, more liquidity," the report states.
Other tech initiatives, including AI tests
Ginnie also revealed that it has engaged in some pilots for new uses of artificial intelligence, including predictive analytics that would identify emerging
The government guarantor also tested machine learning models aimed at detecting data discrepancies that could indicate errors, fraud or weakness in a system, according to the annual report.
Ginnie said the latest numbers for its digital collateral program exceeded fiscal year goals through August, when there were over 300,000
The government guarantor reported that it has 47 approved issuers, four custodians, and eight subservicers active in its digital collateral program.
Mortgage-backed securities totals
The government guarantor also reported that overall, the issuance of $526.4 billion it backed during the past fiscal year helped lenders extend loans to around 1.4 million households. Outstanding MBS Ginnie guaranteed grew 7.2% during the fiscal year.
"The continued strong demand for the Ginnie Mae MBS program creates affordability for the American people," HUD Secretary Scott Turner said in a press release.
Overall government-backed MBS outstanding held by foreign investors stayed within a range it has been in for the past decade at around 15%, according to the report. The report also shows that while China and Taiwan reduced holdings, Japan and the European Union increased them.
"Ginnie Mae's work in fiscal year 2025 reflects a clear focus on our mission of ensuring access to affordable mortgage credit," Gormley said in the release. "By strengthening operations, enhancing cybersecurity, and maintaining disciplined risk management, we reinforced market confidence and attracted global capital."
