Government National Mortgage Association (Ginnie Mae) for Hilton Head Island vacation rentals, villas and beach homes in beautiful Hilton Head South Carolina. Sea Turtle Getaways, Hilton Head Beach Vacation Rentals.

The Government National Mortgage Association (GNMA, also known as Ginnie Mae) was created by the United States Federal Government through a 1968 partition of the Federal National Mortgage Association. The GNMA is a wholly owned corporation within the United States ' Department of Housing and Urban Development (HUD). Its main purpose is to provide financial assistance to low- to moderate-income homebuyers, by promoting mortgage credit.

Business

The GNMA, along with the other so-called Government Sponsored Enterprises (GSEs), sell mortgages in the secondary market. This lets investors put money in the mortgage securities market, which increases the price of the mortgage bonds and lowers their rates, which in turn lowers the rates on mortgages in the primary market so that more people are able to buy and mortgage a home. The GNMA does this by guaranteeing the timely payment of the principal and interest payments on mortgage-backed securities.

There are several types of GNMA securities that are active in the institutional fixed income markets:

* GNMA I securities. A GNMA I (the "I" is a Roman numeral one) represents a pool of mortgages all issued by one issuer, all with the same interest rate, and all issued at around the same time (within a few months).

* GNMA II securities. A GNMA II is similar to a GNMA I, except that the mortgages can have a range of interest rates, and can include mortgages issued by more than one issuer. In this case, the service fees (see below) vary, so that the new interest rate being paid to the investor from each mortgage is the same.

* GNMA "REMIC" securities. A REMIC (Real Estate Mortgage Investment Conduit) is an additional level of securitization. The collateral pool for a REMIC consists not of mortgages, but of mortgage-backed securities (such as GNMA I, GNMA II, or previously issued REMICs).

Pools are created by lenders. For example, a mortgage lender may sign up 100 home mortgages in which each buyer agreed to pay a fixed interest rate of 6% for a 30-year term. The lender (who must be an approved issuer of GNMA certificates) obtains a guarantee from the GNMA and then sells the entire pool of mortgages to a bond dealer in the form of a "GNMA certificate". The bond dealer then sells GNMA mortgage-backed securities, paying 5.5% in this case, and backed by these mortgages, to investors. The original lender continues to collect payments from the home buyers, and forwards the money to a paying agent who pays the holders of the bonds. As these payments come in, the paying agent pays the principal which the home owners pay (or the amount that they are scheduled to pay, if some home owners fail to make the scheduled payment), and the 5.5% bond coupon payments to the investors. The difference between the 6% interest rate paid by the home owner and the 5.5% interest rate received by the investors consists of two components. Part of it is a guarantee fee (which GNMA gets) and part is a "servicing" fee, meaning a fee for collecting the monthly payments and dealing with the homeowner. If a home buyer defaults on payments, GNMA pays the bond coupon, as well as the scheduled principal payment each month, until the property is foreclosed. If (as is often the case) there is a shortfall (meaning a loss) after a foreclosure, GNMA still makes a full payment to the investor. If a home buyer prematurely pays off all or part of his loan, that portion of the bond is retired, or "called", the investor is paid accordingly, and no longer earns interest on that proportion of his bond.

The arrangement seemingly benefits everyone involved:

* The mortgage lender has offloaded all risk to the GNMA, and has very quickly received a reimbursement of the money lent to home buyers from the bond dealer, and can immediately use this money to offer another pool of loans to the public.

* The home-buying public benefits from lower mortgage rates caused by the large amount of lender competition, in turn caused by a large supply of lenders, which is enabled by this quick reimbursement of money.

* The lower-income home-buying public benefits from a greater willingness by lenders to risk making loans to that group.

* The investors, whose money makes all of this work in the first place, benefit from the "full faith and credit" of the United States government; GNMA bonds are backed by the pool of mortgages, and even if massive defaults were to occur, the U.S. government would make good on all payments. GNMA bonds also feature higher returns than other U.S. government issued bonds.

GNMA bonds themselves are considered risk-free from the standpoint of total default, but they are subject to risks that all other bonds have, including interest rate risk. They also have the undesirable attribute of being callable every month, meaning that, unlike other bonds, all or part of a GNMA bond might suddenly "mature" next month, if all the homeowners decided to pay off or refinance their mortgages. This does not involve a risk of loss to the investor, but rather a premature payment of the principal, and now the investor has to go look for another investment for his money. This is called prepayment risk. As a practical matter, many institutional investors find it very inconvenient to own bonds which get small principal payments every month.

The GNMA said in its 2003 annual report that over its history, it had guaranteed securities on the mortgages for over 30 million homes totaling over $2 trillion. It guaranteed $215.8 billion in these securities for the purchase or refinance of 2.4 million homes in 2003.

About Hilton Head Island
With such an amazing variety of things to do on Hilton Head Island, somewhere, somebody is teeing up for the best round of golf they've ever played. Somewhere, a family of four is enjoying their Hilton Head vacation, strolling down a secluded beach as warm Atlantic waters lap at their feet. Somewhere, a couple is enjoying the pastel-colored sky of a beautiful Hilton Head Island sunset. Renowned as one of the world's most family-friendly destinations, Hilton Head Island offers unlimited opportunities for holiday memories and was recently named one of the top ten family beaches in the country. As an intimate getaway for two or an idyllic backdrop for a family reunion, the Island extends a variety of outdoor and indoor recreational activities. You'll notice that there's something different about Hilton Head the moment you arrive. By design, there is a sensitive nod to the environment that has become the blueprint for other developments around the nation. Buildings are set back from the main roads, showcasing the native pines and oaks. Colors are not flamboyant and bright; instead, they are subdued and blend with the natural environment. And bright streetlights here are as rare as snowstorms. A progressive land purchasing program undertaken by town leadership ensures that there's plenty of green wherever you go, and strict development guidelines ensure that the only thing between your eyes and a breathtaking view are your sunglasses. It's easy to see why more than 39,000 people have chosen to call the Island their permanent home. At the very foundation of the Hilton Head Island vacation experience is the community of full-time residents who work hard to make sure their Island is a clean, safe and enjoyable place to visit. You'll notice it in the friendly faces that greet you wherever you go. There is a relaxed and warm island attitude in the air, one that whispers "Welcome to Hilton Head Island. Hilton Head Island was named one of the Top 10 Family Beaches.

Hilton Head Island Attractions & Activities
Hilton Head Island fills your family's days with fun and activities. Pristine beaches, flexible accommodation options and endless recreation have made Hilton Head Island a first choice for family vacations. Both day and evening entertainment for the entire family is far reaching. Every April, the Verizon Heritage PGA TOUR golf tournament is played in Hilton Head Island and the Hilton Head Celebrity Golf Tournament is held on Labor Day Weekend. During the month of May, Hilton Head Island and the Lowcountry celebrate the area’s vibrant arts community and diverse cultural heritage through visual and performing arts events, cultural activities and programs with BRAVO-Celebrate the Arts! Budget friendly activities are available day and night on the Island. Families can venture to the top of the Harbour Town Lighthouse in Sea Pines for only a dollar each person. This activity offers a clear view of the Island’s south end as well as the eye pleasing Harbour Town Marina. Also available in Sea Pines is shopping, waterfront dining and horse back riding. Families could spend at entire day in Sea Pines alone. Other family friendly spots include Shelter Cove Harbour, Adventure Cove, the Coastal Discovery Museum and The Sandbox, An Interactive Children's Museum. Shelter Cove Harbour offers a variety of experiences such as shopping, kayaking, sailing and cruise excursions, fireworks and concerts. Activities at Adventure Cove include laser tag, bumper cars, video arcade, an indoor play room, miniature golf and more. Other miniature golf courses include Legendary Golf and Pirate’s Island Adventure Golf. The Coastal Discovery Museum offers programs, activities, and exhibits to make learning about Hilton Head and other sea islands an enjoyable experience. The museum is a great place to visit any time of the year. With indoor and outdoor exhibits, activity centers in the Sea Island Classroom, the History Time-line Exhibit and museum store, plus 11 different tours and cruises around the island, the museum is a fantastic way to become familiar with the Island's unique history and ecology. The Sandbox is a hands-on interactive museum filled with unique entertaining, and educational play areas to explore. At The Sandbox all the exhibits are designed to help children learn while having fun and bonding with each other and their caregivers. There are no “do not touch” signs at this Museum. Children can sail away on Captain William Hilton’s ship The Adventure, find their Passport to the World in the international airport terminal with a simulator plane ready to take the little ones anywhere, and visit the Loggerhead sandcastle filled with magic sand. For a more relaxing adventure, two multi-screened movie theaters and one independent film theater allow families to catch the latest on the silver screen. In addition, the stage is always set at the Arts Center of Coastal Carolina, the South Carolina Repertory Company and the May River Theatre Company.

Directions to Hilton Head Island
From I-95: Take Exit 8 (eight miles from the Georgia border) and go east following signs to Hilton Head Island. This is Highway 278 and you will travel about 18 miles and then you cross the bridge to Hilton Head. Continue over the bridge and look for signs for the Cross Island Expressway. If you are going to the south end of the island (Shipyard, Coligny, Forest Beach, Sea Pines) stay to your left and use the expressway (Toll $1) to save time. Otherwise, keep right and stay on Highway 278 Business. After you cross the bridge onto Hilton Head Island, look for the Welcome Center and Coastal Discovery Museum on your right. The Welcome Center has brochures on Hilton Head activities, additional maps and upcoming events. If flying into the Savannah/Hilton Head International Airport, take I-95 North and follow the above directions.