Explanation Of Ginnie Mae In Real Estate

Definition of "Ginnie Mae"

Melody Smedick, Broker/Owner, Real Estate Agent Preferred Real Estate Group

Looking to understand what is Ginnie Mae? You’ve been hearing about it and knows not what it means. Let us help with the most succinct Ginnie Mae definition possible: Ginnie Mae is the Government National Mortgage Association (GNMA). It’s basically the phonetic sound of the initials. Say “GNMA” quickly and you get the “Ginnie Mae” sound.

The mission of Ginnie Mae is to fund high-risk mortgages for high-risk borrowers that are typically located in areas approved for government construction projects that have no other funding sources. The government body also offers guarantee mortgages issued by others, such as commercial banks, mortgage banks, and insurers.

You can’t tell Ginnie Mae’s history without talking about Fannie Mae. Ginnie Mae is almost like a younger sister or spiritual daughter of Fannie Mae. Here’s the timeline: Fannie Mae was founded in the 1930’s as a fully government-owned company, then became a mixed-ownership company, and then, in 1968, when it came time to go full private sector, the Government thought it was important to conserve a similar federal operation, thus spawning Ginnie Mae and making it part of the Department of Housing and Urban Development (HUD) in order to expand affordable housing finance. Ginnie Mae is the primary financing mechanism for all mortgage loans that are government-insured.

Real Estate Tips:

Don’t know if you qualify for Ginnie Mae and this whole names-galore – yes, because we didn’t even bring up the Freddie Mac definition to make it simple – is it making you confused? Reach out to a real estate agent and let him (or her!) point out the best direction for your case.