Just two days after revealing new requirements for securitized loans to veterans, the Government National Mortgage Association has restricted three issuers — including one of the biggest mortgage originators.
On Wednesday, the government-owned corporation issued All Participant Memorandum 18-04 covering new seasoning requirements on Department of Veterans Affairs-guaranteed mortgages to be securitized in Ginnie Mae pools.
The changes were required by  the Economic Growth, Regulatory Relief, and Consumer Protection Act in response to refinance churning concerns.
Friday, the Washington-based company announced that it restricted VA single family guaranteed loans pooled by Freedom Mortgage Corp., SunWest Mortgage Company Inc. and NewDay USA.
With $51 billion in production last year, Freedom was the seventh-largest mortgage originator in the country.
According to Ginnie, the trio of lenders are still approved but restricted from including VA loans in Ginnie Mae I securities or Ginnie Mae II multi-issuer securities.
All three firms can still pool FHA- and RHS-insured mortgages in all eligible pool types.
Freedom’s and SunWest’s restrictions start on July 1 and remain in place until Jan. 1, 2019. NewDay’s restriction started on April 1 and ends on Oct. 1.
“The conclusion date assumes that by the specified date, an issuer has demonstrated, to Ginnie Mae’s satisfaction, that (a) prepayment speeds are substantially more in-line with those of equivalent multi-issuer cohorts, and (b) such improved performance is sustainable,” the notice stated.
