Joe Gormley addresses those pesky Ginnie Mae rumors

What you might have heard about Ginnie Mae is simply rumor, according to Joe Gormley, the government-owned company’s executive vice president and chief operating officer. Gormley says that Ginnie Mae has adequate staffing to fulfill its mission, has no plans to shrink the size of issuers and furthermore is happily accepting new issuers.

In a conversation on Monday with Pete Mills of the Mortgage Bankers Association at the MBA’s Secondary & Capital Markets Conference, Gormley outlined his priorities at Ginnie Mae and answered questions about its oversight of a vast $2.73 trillion portfolio of mortgage-backed securities.

When asked about concerns over low staffing levels, Gormley said there are more than 200 employees at Ginnie Mae and that he feels “very good about where we are from a staffing perspective.”

“We are able to meet all of our operational commitments; all of our critical contracts remain in place,” he said. “So I think we’re in a really good spot. We had some senior-level retirements over the last six months, but we’ve gotten permission to move forward with some senior-level hires. I’m hoping to get some really good people in, so hopefully that will move into the interview phase in the next couple weeks.”

Gormley, who served at the U.S. Department of Housing and Urban Development (HUD) during President Donald Trump’s first term, spoke positively about the impacts of the Elon Musk-led U.S. DOGE Service. This comes despite news reports that the agency laid off staffers who were brought on to help protect lenders from cyberattacks, which roiled the mortgage market.

“There’s been a lot of things in the news reports about DOGE. We’re very excited about some of the technological resources to just bring into bear, and some of the possibilities that we could introduce in the Ginnie program through AI,” Gormley said.

“[We are] just really at the beginning stages of that. But again, using AI … to allow the staff to kind of get out of some of the more rote day-to-day stuff and think about bigger-picture things is exciting.”

Gormley told Mills that there remains a robust global market for Ginnie Mae securities and he has not seen any pullback from investors. The corporation is focused on looking at ways to introduce more private capital into its ecosystem. Importantly, Ginnie Mae is looking at moving from a monthly liquidation file to a daily file, he said.

“Cyberattacks pulled blinders away on that,” he said. The company has also been working on digital collateral projects, which can save significant money for counterparties.

While the queue for new issuer approval has gotten long and many don’t get it right on the first shot, Gormley said there’s no plan afoot to shrink the user base or dissuade issuers of any size from working with Ginnie Mae.

The pair touched on the topic of delinquencies. Gormley said overdue mortgages are rising in part because of increased taxes and insurance, as well as the return of student loan payments. Ginnie Mae is carefully watching these trends, he said.

There have been a number of proposals over the years to bring additional liquidity into the marketplace — such as MBA’s proposed early-buyout program — but thus far none have been implemented.

“We want to ensure that anything we do on liquidity brings greater private capital into the Ginnie Mae ecosystem,” Gormley said. “Our preference is to incentivize private capital, but I do think we need to have the proper tools in the toolbox so if there were a stressed environment, we could step in in a meaningful way to assist with bringing liquidity to bear.

The other thing is, anything we do on liquidity has really got to leave Ginnie Mae in a better place, right? So strengthening the Ginnie Mae program has got to be kind of our North Star.”