Secondary Markets

Standard & Poor's Ratings Services has revised its U.S. residential mortgage-backed securities (RMBS) home equity conversion mortgage (HECM) reverse mortgage cash flow assumptions.

The following published reports discuss the risks associated with securitizing reverse mortgages.

Ginnie Mae officially launched its HECM Mortgage-Backed Securities program on September 1, giving lenders a new option to securitize FHA reverse mortgages in the secondary market.

For 18 years, FHA’s Home Equity Conversion Mortgage was a financial rocket sitting on a launching pad without adequate fuel. Now, Ginnie Mae’s new HMBS is the fuel that will propel the program into the orbit of aging finance.

The U.S. Department of Housing and Urban Development published a final rule that adds the 1-month and 1-year London Interbank Offered Rate (“LIBOR”) as acceptable indices for calculating the interest rate on federally-insured reverse mortgages.

Let’s face it: You need capital to grow your reverse mortgage business. Unless you have wealthy friends and family, you need Wall Street, and Wall Street needs a hot industry, aka reverse mortgages.

In preparation for launching its HECM Mortgage-Backed Securities program in September, Ginnie Mae has published a 79-page reference guide for interested parties to learn the program rules and requirements.

The secondary market is the source of financial oxygen for the mortgage lending business, forward or reverse. Smart originators pay attention to what’s happening there.

NRMLA invited some of the reverse mortgage industry's most prominent leaders to discuss emerging business trends, including product design and innovation, the possible need for suitability standards, and the impact of a growing secondary market.

NRMLA President Peter Bell addressed the National Press Club on October 17 in support of Ginnie Mae's plans to develop a platform that will be used to securitize FHA reverse mortgages in the near future.