Ginnie Mae giving investors a deeper look at MBS profiles

Investors will get deeper insights into rural housing profiles within Ginnie Mae guaranteed mortgage-backed securities.

Ginnie will share monthly disclosures detailing the number of loans with rural borrowers at the MBS level, and the percentage of unpaid principal balance they represent. This month's rollout is already live, and will be available on the sixth business day of every month going forward, the Department of Housing and Urban Development affiliate said this week. 

"This enables investors to shift from an over-emphasis upon the insuring agency program by including additional borrower attributes," said Richard Perrelli, product manager, office of capital markets at Ginnie, in a press release. "These factors will help create superlative MBS valuation models."  

The agency worked with the U.S. Department of Agriculture and its geographers to accurately define rural borrowers, using the USDA's rural-urban commuting area codes. The codes classify census tracts by population density, urbanization and daily commuting, and borrowers in RUCA Codes 4 through 10 are considered rural for the disclosures. 

Many mortgage borrowers with loans that the Department of Veterans Affairs or the Federal Housing Administration back live in those areas, Ginnie Mae acting president Sam Valverde said. Ginnie guarantees securitizations of these and other government loans.

"This expanded rural definition helps demonstrate our commitment to these communities," Valverde said in a press release. "This new disclosure will also give investors a clearer view of the social mission of our securities program." 

The government corporation recently announced several other modernization updates, including the addition of custodian and servicer/subservicer identifiers in investor reporting. It guaranteed $41.2 billion in issuance in August, nearing a peak reached in September 2022.