A Glitch in Ginnie Mae's Data
While completing our recent analysis of Ginnie Mae mortgage data on first-time homebuyers, we uncovered a glitch that inaccurately portrayed a significant and unexpected decline in the share of first-time homebuyers in March 2013. Ginnie Mae can and should publish accurate data through its old reporting method until the problem has been resolved.
In our brief, we examined the new, public Federal Housing Administration loan-level data from the Ginnie Mae MBS database and found that the first-time homebuyer share suddenly dropped in in March 2013 from 78 percent to 68 percent. In our calculations, the sudden drop caused a big decrease in the 2013 and 2014 average first-time homebuyer shares, to 69 and 68 percent respectively. When we compared our calculations from the public Ginnie Mae data with calculations from FHA's internal data, however, the numbers were quite different: First-time homebuyer shares in 2013 and 2014 were 79 and 81 percent, respectively.
What's behind the discrepancy? Prior to March 2013, the first-time homebuyer information was pulled from internal FHA data. Starting with March 2013, Ginnie Mae began to use its own first-time homebuyer information as reported by its issuers. Thus, the likely cause for this data discrepancy is the underreporting from some of the issuers, as the data field is a relatively new addition that Ginnie Mae mandated in late 2012.
Why do we need public loan-level data? Although FHA routinely reports monthly and annual summaries of the first-time homebuyer shares, only the rich loan-level data currently provided through Ginnie Mae allows us to link first-time homebuyer status to borrower characteristics and loan performance. With loan-level data, researchers can conduct more in-depth analyses, such as comparisons between first-time and repeat homebuyers.
What’s next? Ginnie Mae is aware of this data disparity and is actively identifying and correcting it by alerting those issuers with deficient information. It is vitally important, however, that reliable data be made available in the meantime so policymakers can evaluate FHA's current programs to accurately inform housing policies. Thus, until this data issue is resolved, we urge Ginnie Mae to switch back to reporting the first-time homebuyer information using the internal FHA data, as was done for loans issued before March 2013.
Bing Bai is a research associate, and Jun Zhu is a senior financial methodologist, with the Housing Finance Policy Center at the Urban Institute.