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History of Ginnie Mae

In 1934, during the depths of the Depression, Congress passed the National Housing Act to strengthen a deeply troubled housing market. An important element of this legislation was to make mortgage funds available to more Americans by protecting lenders from the risk of default.

In 1938, Congress amended the act to create the Federal National Mortgage Association – an entity designed to help mortgage lenders gain access to capital for mortgage loans.

The provisions of the act changed gradually over the years until, in 1968, Congress established the Government National Mortgage Association, commonly known as Ginnie Mae, as a government-owned corporation within the Department of Housing and Urban Development (HUD). Today, Ginnie Mae securities are the only mortgage-backed securities that offer the full faith and credit guaranty of the United States government.

Ginnie Mae: Cumulative Total Graph

The Pioneer of Mortgage-Backed Securities

In its earliest days, housing finance was a fragmented, inefficient and illiquid market, with mortgage rates varying considerably from region to region, and some locations having practically no funds available at all. This was a direct consequence of the near impossibility of selling individual mortgages on the secondary market. Lending institutions would issue a mortgage, collect payments, and file the mortgage away until the principal was paid off. The problem: a lack of available, consistently priced capital put a ceiling on the number of new mortgages that could be issued.

Ginnie Mae solved this problem and revolutionized the American housing industry in 1970 by pioneering the issuance of mortgage-backed securities.

Today, lenders pool packages of qualifying FHA, VA, RHS or PIH mortgages and convert them into securities. Ginnie Mae guarantees investors the timely payment of principal and interest on these securities.

In a single step, the issuance of Ginnie Mae mortgage-backed securities converts individual mortgages into safe, liquid securities for investors around the world. Ginnie Mae thus helps channel global capital into American housing markets, helping make more mortgages available.


A Proud Tradition, a Promising Future

Ginnie Mae's programs continue to develop and evolve. Over the years, we have guaranteed more than $2 trillion in mortgage-backed securities, helping more than 30 million households in America gain access to affordable housing.

Cumulative Total Number of Households Assisted by Ginnie Mae Graph 1970 - 2002

As we move into the future, Ginnie Mae will continue to look for ways to build upon our tradition of financial strength and stability to provide the best value for our issuers and our investors-and to fulfill our mission.

Because at Ginnie Mae, we never lose sight of that mission: to expand affordable housing in America by linking global capital markets to the nation's housing markets.

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