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2018-045: Economic Growth, Regulatory Relief, and Consumer Protection Act
Published Date: 5/31/2018 12:00 AM

The President of the United States signed into law the Economic Growth, Regulatory Relief, and Consumer Protection Act (S.2155 / P.L. 115-174). The Act prohibits Ginnie Mae from guaranteeing securities issued on or after May 24, 2018, if such securities are backed by a refinance loan that is guaranteed under the United States Department of Veteran Affairs benefit program and that does not meet the condition provided in the Act. To qualify for inclusion in a Ginnie Mae guaranteed MBS, the Act requires VA refinance loans to have a note date that is on or after, the later of: (1) the date that is 210 days after the date on which the first monthly payment is made on the mortgage being refinanced, and; (2) the date on which six (6) full monthly payments have been made on the mortgage being refinanced.

To implement the provisions of the Act, Ginnie Mae has revised its pooling eligibility requirements and amended its Mortgage-Backed Securities Guide with the publication of “APM 18-04: Eligibility of VA Refinance Loans under the Economic Growth, Regulatory Relief, and Consumer Protection Act, S.2155.”

As detailed in APM 18-04, the Ginnie Mae guaranty attached to Ginnie Mae MBS is not affected by the Act, regardless of the issuance date. The guaranty for Ginnie Mae securities dated May 2018 or earlier is unaffected even if such securities are backed by a pool or loan package containing refinances that do not meet the condition implemented by the Act. Ginnie Mae securities dated June 2018 or later will comply with the new pooling requirements which implement the conditions provided in the Act.

Consequently, Ginnie Mae will continue to accept Ginnie Mae MBS as eligible for REMIC and Platinum Securities transactions under its multiclass securities programs. Similarly, Ginnie Mae will continue to process and participate in multiclass securities transactions under the same requirements and protocols articulated in its Multiclass Securities Guide and in effect prior to the passage of the Act.