Ginnie Mae - Government National Mortgage Association - GNMA

What is 'Ginnie Mae - Government National Mortgage Association - GNMA'

A U.S. government corporation within the U.S. Department of Housing and Urban Development (HUD). Ginnie May aims to:

1. Ensure liquidity for government-insured mortgages, including those insured by the Federal Housing Administration (FHA), the Veterans Administration (VA) and the Rural Housing Administration (RHA).
2. Bring investors' capital into the market for these types of loans, so that the issuers have the means to issue more.

Most of the mortgages securitized as Ginnie Mae mortgage-backed securities (MBSs) are those guaranteed by FHA, which are typically mortgages for first-time home buyers and low-income borrowers.

BREAKING DOWN 'Ginnie Mae - Government National Mortgage Association - GNMA'

Ginnie Mae neither issues, sells or buys pass-through mortgage-backed securities, nor does it purchase mortgage loans. It simply guarantees (insures) the timely payment of principal and interest from approved issuers (such as mortgage bankers, savings and loans, and commercial banks) of qualifying loans, such as those issued by the FHA and RHA.

Unlike its cousins Freddie Mac, Fannie Mae and Sallie Mae, Ginnie Mae is not a publicly-traded company. An investor in a GNMA security will not know who the underlying issuer of the mortgages is, but merely that the security is guaranteed by GNMA, which is backed by the full faith and credit of the U.S government, just like U.S. Treasuries.

RELATED TERMS
  1. Ginnie Mae Pass Through

    A type of investment issued by the Government National Mortgage ...
  2. Dwarf

    A slang term used to describe a pool of mortgage backed securities ...
  3. Mortgage Pool

    A group of mortgages held in trust as collateral for the issuance ...
  4. Midgets

    A slang term referring to a Government National Mortgage Association ...
  5. Federal Housing Administration ...

    A United States government agency that provides mortgage insurance ...
  6. VA Loan

    A mortgage loan program established by the United States Department ...
Related Articles
  1. Stock Analysis

    Ginnie Mae To Big Banks: Show Us Your Mortgages. But Can They?

    The Government National Mortgage Association (Ginnie Mae) recently discovered that Bank of America (NYSE: National Mortgage News. Because Bank of America is missing so many documents, Ginnie ...
  2. Insurance

    Fannie Mae and Freddie Mac, Boon Or Boom?

    These two companies are crucial to the mortgage market, but are they ticking timebombs?
  3. Home & Auto

    FHA Money Trouble Causes Concern For Homebuyers

    The FHA says it's operating in the black, but reports say otherwise. If it goes bankrupt, what will the repercussions be?
  4. Home & Auto

    Requirements For A Post-Housing-Bust Mortgage

    Affordable mortgages are still available, but the standards for qualifying have gotten higher.
  5. Options & Futures

    20 Investments: Mortgage-Backed Securities

    What Is it? A mortgage-backed security (MBS), also known as a "mortgage pass-through" or a "pass-through certificate", is an investment instrument that represents ownership of an undivided interest ...
  6. Home & Auto

    7 Things To Know About FHA Home Loans

    Federally qualified lenders issue FHA loans, and the Federal Housing Administration insures them.
  7. Home & Auto

    This New Mortgage Only Requires 3% Down

    A new low-down-payment mortgage offering has attractive features, but be sure to check out all the options and get the whole story before you sign up.
  8. Credit & Loans

    Why Choose an FHA Jumbo Mortgage Over Other Jumbos?

    Housing prices are through the roof in the locale where you’d like to live. How will you afford to buy? One of these home loans may be the answer.
  9. Home & Auto

    HUD vs. FHA Loans: What’s the Difference?

    Sometimes these terms are used interchangeably to refer to "government loans" for would-be home buyers. But here's the distinction.
  10. Home & Auto

    Insuring Federal Housing Authority Mortgages

    This insurance has an edge over private mortgage insurance. Find out why.
RELATED FAQS
  1. What is a Ginnie Mae security?

    A Ginnie Mae, or Government National Mortgage Association security, functions similarly to the process of lending someone ... Read Answer >>
  2. Are mortgage-backed securities backed by any guarantees?

    Actually, any mortgage-backed security (MBS) guarantee depends on who issued it.To review, an MBS is a security, created ... Read Answer >>
  3. Do FHA loans have closing costs?

    Learn about Federal Housing Administration loans and how financial institutions that issue FHA mortgages charge borrower ... Read Answer >>
  4. What are some historical examples of debt securitization?

    Find out how debt securitization started, how it works and why the government facilitated the mortgage-backed security market ... Read Answer >>
  5. How do you use the FNMA selling guide?

    Learn about Fannie Mae Selling Guide and find out details about how its parts provide support to the business relationship ... Read Answer >>
  6. Can I buy a house directly from Fannie Mae (FNMA)?

    Yes; you can buy homes directly from Fannie Mae. Fannie Mae (the Federal National Mortgage Association, or FNMA) is a government-sponsored ... Read Answer >>
Hot Definitions
  1. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  2. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  3. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  4. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  5. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  6. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
Trading Center