Ginnie Mae Tops Freddie Mac as MBS Issuer

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Ginnie Mae surpassed Freddie Mac in total outstanding mortgage securities backed by single-family loans for the first time, according to researchers at the Urban Institute.

"Ginnie has edged past Freddie Mac" in May, said Alanna McCargo, co-director of the Housing Policy Research Center at the Urban Institute, during a press briefing Thursday on the center’s release of its housing finance chartbook.

The total outstanding balance of Ginnie Mae mortgage-backed securities was $1.624 trillion as of May 31, compared to $1.623 trillion in outstanding Freddie Mac MBS, according to Urban Institute calculations based on eMBS agency MBS security data.

The researchers' figures also show Ginnie Mae issued $41.6 billion in single-family MBS in May, compared to Freddie Mac's issuance of $29.9 billion of single-family mortgage securities, which Freddie calls participation certificates.

Freddie Mac PC issuance has been slowly declining since 2010 while Ginnie Mae MBS issuance has been gradually rising since mid-2008.

Two years ago, Laurie Goodman, the co-director of the Housing Policy Research Center, predicted that "Ginnie Mae will overtake Freddie Mac within a year as the second largest single-family securitization platform."

Speaking about the issue this week, Ted Tozer, the president of Ginnie, said "what's most important about this milestone is not that we have passed Freddie Mac in outstanding mortgage-backed securities, but that Ginnie Mae's public-private partnership model assured credit access would continue for borrowers and supported the housing recovery."

"The strength of this partnership has enabled more than 10 million families achieve the American dream. This is a tribute to the staff at Ginnie Mae and the private sector diligently working together to expand and enhance affordable housing finance," he added.

Ginnie Mae securitizes Federal Housing Administration, Department of Veterans Affairs and Rural Housing Service loans.

FHA-insured loans offer more competitive rates than Freddie-backed loans and Ginnie has benefited from an uptick in VA loans over the past few years, according to McCargo.

However, Fannie Mae remains the largest securitization platform. Outstanding securities issued by Fannie, Freddie and Ginnie totaled $5.89 trillion as of May 31. Fannie Mae's share represented 44.9% of the pie, compared to 27.6% for Freddie Mac and 27.6% for Ginnie Mae.

Freddie did not respond to requests for comments on the Urban Institute report. Freddie is not expected to release its May securitization data until next week.

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