U.S. flag

An official website of the United States government Here’s how you know

The .gov means it’s official.

Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you're on a federal government site.

The site is secure.

The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Hotline

Crime, Fraud, Waste, and Abuse
March 28, 2023
  • Government National Mortgage Association
2023-KC-0003
Return to Index

We identified gaps in Ginnie Mae’s guidance and process for troubled issuers.  Ginnie Mae made progress in developing an issuer default governance framework, but has not (1) defined its authorities for marketing troubled portfolios; (2) formalized guidance for how to identify potential buyers before extinguishment; (3) established expectations for determining portfolio value, price before sale, and evaluation against other options or (4) included a step to evaluate prospective purchasers’ ability to absorb an extinguished portfolio.  Additionally, we found Ginnie Mae had implemented our previous recommendation to develop and implement controls to determine the total impact of a large- or multiple-issuer default, the maximum-size default Ginnie Mae could adequately execute, and individual issuers’ ability to adapt to changing market conditions, but there was a gap related to the semiannual capacity reports submitted by master subservicers (MSS).

Recommendations

Government National Mortgage Association

  •  
    Status
      Open
      Closed
    2023-KC-0003-001-A
    Priority
    Priority

    We believe these open recommendations, if implemented, will have the greatest impact on helping HUD achieve its mission to create strong, sustainable, inclusive communities and quality affordable homes for all.

    Closed on February 01, 2024

    Update its policy and procedures to define its authority for marketing troubled issuer portfolios and the conditions that must exist to extinguish issuers using rapid relocation.

  •  
    Status
      Open
      Closed
    2023-KC-0003-001-B
    Priority
    Priority

    We believe these open recommendations, if implemented, will have the greatest impact on helping HUD achieve its mission to create strong, sustainable, inclusive communities and quality affordable homes for all.

    Closed on May 29, 2024

    Update its policy and procedures to define what type of information Ginnie Mae may disclose and how it will handle protected information before extinguishment.

  •  
    Status
      Open
      Closed
    2023-KC-0003-001-C
    Priority
    Priority

    We believe these open recommendations, if implemented, will have the greatest impact on helping HUD achieve its mission to create strong, sustainable, inclusive communities and quality affordable homes for all.

    Closed on May 29, 2024

    Update its Policies and procedures to define how Ginnie Mae will determine the portfolio value and price before Sale.

  •  
    Status
      Open
      Closed
    2023-KC-0003-001-D
    Priority
    Priority

    We believe these open recommendations, if implemented, will have the greatest impact on helping HUD achieve its mission to create strong, sustainable, inclusive communities and quality affordable homes for all.

    Closed on May 29, 2024

    Update its policies and procedures to define how Ginnie Mae intends to identify and evaluate prospective buyers to ensure its ability to absorb the extinguished portfolio before executing the purchase and sale agreement.

  •  
    Status
      Open
      Closed
    2023-KC-0003-002-A
    Closed on June 27, 2023

    Assesses what information Ginnie Mae needs from the MSS to ensure that they have the capacity for a large- or multiple-issuer extinguishment.

  •  
    Status
      Open
      Closed
    2023-KC-0003-002-B
    Closed on June 27, 2023

    Prescribes how the contracting officer representative will review information provided by the MSS and provide actionable feedback to ensure MSS readiness.