League Urges Policy Change for CUs With Regard to Ginnie Mae Eligibility Requirements for Single-Family MBS Issuers

Your League last week submitted a response to the recent Request For Input (RFI) issued by the Government National Mortgage Association (“GNMA” or “Ginnie Mae”), titled "Eligibility Requirements for Single Family MBS Issuers."

The League generally agrees with Ginnie Mae’s intent to establish requirements that address each issuer’s mortgage banking activity and risk profile and make it easy to calculate an issuer’s required capital, notes the letter. 

However, the RFI contains an assumption that counterparty risks to Ginnie Mae are the same for credit unions and non-bank mortgage lenders.

"We do not believe Ginnie Mae’s treatment of credit unions as “nonbanks” is appropriate," writes the League. "Ginnie Mae should properly recognize credit unions as depository institutions that are strictly regulated by the National Credit Union Administration (NCUA). NCUA has stringent capital requirements for insured credit unions. Grouping credit unions with nonbank mortgage lenders fails to recognize credit unions as heavily regulated and well-capitalized depository institutions."

Ginnie Mae should simply adopt NCUA’s findings regarding credit union capitalization, given that NCUA addresses the risk profile of each institution it examines.

Read our letter
Read CUNA's letter