Glossary of Distressed Real Estate – G

Ginnie Mae – Stands for “Government National Mortgage Association” or “GNMA.”  This quasi-governmental agency acts as a secondary market for the purchase of federally insured or guaranteed loans, such as the FHA, DVA and the Rural Housing Service.  Since these loans are guaranteed or insured, the original lenders are able to make lower interest rate loans with more flexible terms, thus enabling lower and middle income borrowers to obtain housing funds.  The notes and mortgages or trust deeds are then pooled and sold as securities to investors who are guaranteed the timely payment of principal and interest.

Good Faith Estimate (“GFE”) – A form given by lenders, mortgage brokers and other loan originators to borrowers when applying for a loan.  The GFE provides an estimate of the settlement or closing charges and loan terms the borrower may expect if approved for their particular loan. Substantial changes to GFE rules became effective January 1, 2010 in an effort to provide more clarity, accuracy and accountability in GFEs.  [Substantial consumer information about good faith estimates can be obtained here.]

Government Sponsored Enterprise (“GSE”) – The primary examples are Fannie Mae, Freddie Mac, and Ginnie Mae.  Although Fannie and Freddie were federally created initially as privately held entities designed to purchase mortgages in the secondary market, they were regarded as having the implicit “full faith and credit” of the United States behind them.  Recent events have tended to confirm that the federal government will not let Fannie and Freddie fail, although they are in continuous need of infusions of money to stay afloat.  In 2008 Fannie and Freddie were taken over by the federal government, although they still perform their initial mission of purchasing loans in the secondary mortgage market.

Graduated Payment Mortgage (“GPM”) – Mortgages that have graduated payments, that is, commencing with lower monthly installments of principal and interest, and growing larger over a designated period of time, ultimately reaching a fixed level for the remainder of the loan term.

Grantee – A term used in a deed of conveyance to refer to the recipient of the real property interest.

Grantor – A term used in a deed of conveyance to refer to the person or entity making the conveyance of the real property interest.

Gross Income – One’s income from all sources before adjustments for taxes and deductible items.