Ginnie Mae released further details of the operational changes it is introducing to Ginnie II multiple-issuer pools. The programme changes, initially announced by Secretary of Housing and Urban Development Shawn Donovan in April, include enhancements aimed at minimising financial risk for warehouse lenders and making the programme more efficient for all lenders.

"These programme changes reflect one more step in Ginnie Mae's continuing efforts to bring greater stability to the housing market by minimising financial risk on warehouse lending lines," says Ginnie Mae president Theodore Tozer. "As we've become a larger piece of the housing recovery puzzle, the housing industry has looked to Ginnie Mae to lead and this is one example of how we've responded quickly to the challenging business needs of our issuers."

Beginning this autumn, issuance for Ginnie II multiple-issuer pools can occur on a daily basis, rather than once a month. "Lenders will be able to better utilise warehouse lending lines and reduce interest costs associated with carrying loans until they can be securitised and settled," Tozer adds.

Under the second programme change, lenders will be able to securitise a single loan in Ginnie Mae multiple-issuer pools, thereby eliminating the current three-loan minimum requirement. The change is designed to enable small lenders to more easily participate in multiple-issuer pools.

Additionally, the programme enhancement helps to accommodate "orphan loans" or individual loans that cannot be securitised because the interest rate differs significantly (at least 50bp) from other, more similarly characterised loans in the pool. Ginnie Mae expects to begin accepting single loans into multiple-issuer securities in July.