Ginnie Mae is declaring its reverse mortgage securitizations off-limits for a new type of product that would require the servicer to take interest rate risk.

After May 31, the agency will no longer allow its pools to include fixed-rate Home Equity Conversion Mortgages that distribute some of their proceeds as a line of credit. Such loans have cropped up in response to rule changes at the Federal Housing Administration, which insures HECMs, the predominant reverse mortgage program.

Limited Time Offer

Save $400 off your subscription. Special offer ends April 30, 2017.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.