The Government National Mortgage Association, also known as Ginnie Mae, has said it’s planning to give its internal computer systems a big makeover, with the modernization set to be completed by 2020.
Ginnie Mae said its otherwise reliable mortgage-backed securities platform is overdue a major upgrade, with plans for decreasing the costs and risks to both the market and the taxpayer. It also wants to increase efficiencies and improve user’s experiences, as well as make security and stability improvements, it said.
The agency, which sells mortgage-backed securities, will also introduce a new issuer portal called MyGinnieMae, together with a new help desk. It will also replace physical authentication tokens with digital counterparts for everyday access.
MyGinnieMae will provide enhanced security and a single-entry point for each approved application for each user, in addition to a registration and access request process. Essentially, the idea is for the portal to become an all-in-one solution for accessing Ginnie Mae’s business applications.
The agency will also develop and implement new policies, technologies and operational capabilities to enable it to take digital promissory notes and other kinds of digital loan files.
“While we engage in the technical work necessary to promulgate the standards applicable to electronic closings, digital instruments and electronic vaults, we will also work with the housing programs we support to standardize policies and any other origination requirements for digital mortgages,” the company told HousingWire.
The agency plans to work closely with Fannie Mae and Freddie Mac so as to benefit from their experiences with digital mortgages.
“We believe aligning policies across federal housing programs and developing technical standards are foundational steps; they will be our priority during the initial stages of our digital collateral strategy,” agency officials stated.
Ginnie Mae will also improve its counterparty risk management and safeguards against issuer failures, it said.
Not to split hairs ... GNMA is an insurer, not seller of MBS.
After an originator creates a pool (with GNMA insurance), the GNMA pool is sold and delivered primarily to MBS bond dealers to be resold in the secondary market almost exclusively to institutional investors.
Prior GNMA President, Ted Tozer, pressed for this overhaul and was able to accomplish a lot with the limited resources he was given. It is great to see this modernization going forward. It should increase transparency and reduce risk.