HUD OIG Report on GNMA Nonbank Concentration Risk

The HUD Office of Inspector General (OIG) issued a Report on March 30, 2026, titled, "GNMA did not formally assess rising nonbank concentration risk." Key excerpts from the Report are shared below.

• “Ginnie Mae does not formally assess whether the risk impacts its operations, existing internal controls, or its ability to meet its agency goals. If this continues, it could complicate Ginnie Mae’s ability to effectively monitor or respond to any failures of the largest nonbank mortgage companies.

• As of May 2025, Ginnie Mae’s MBS portfolio outstanding principal balance was approximately $2.7 trillion for all its programs including single family, multifamily, reverse mortgages, and manufactured housing.

• Ginnie Mae assumes the obligations for the issuer’s entire portfolio of government insured loans when an issuer defaults. This exposes Ginnie Mae to the risk of losses not covered by the primary government guarantees. The May 2024 FSOC Report on Nonbank Mortgage Servicing stated that nonbanks have unique vulnerabilities to macroeconomic shocks including sharp changes in interest rates and consumer demand for mortgages. In addition, nonbanks generally hold a high share of Ginnie Mae servicing which could complicate resolution efforts if a large nonbank fails.

• At the end of 2018, 34 percent of Ginnie Mae’s nearly $2 trillion in outstanding MBS in forward loans were held by the seven largest nonbank mortgage companies in the Ginnie Mae MBS program. This percentage rose significantly by 2024, as 59 percent of Ginnie Mae’s $2.6 trillion in outstanding MBS were held by the seven largest nonbanks six years later. In addition, from December 2018 to December 2024, the seven largest nonbank issuers requested and were approved by Ginnie Mae to purchase approximately $1.1 trillion in loans and originate another $1.4 trillion in new loans.

• The seven largest nonbank issuers purchased 90 percent of all pooled loans from 2018 to 2024, totaling approximately $1.1 trillion. Ginnie Mae allows issuers to sell MBS in pools of guaranteed loans to other issuers with Ginnie Mae’s prior approval. Issuers may sell for several reasons, including meeting strategic goals, shifting risk tolerance, or other financial reasons. From the data provided by Ginnie Mae, the agency denied only 4 transfers out of 374,336 requests for bulk purchases and approved all requests for purchases of pools issued for immediate transfer.”

Relevant Charts below: