What does GNMA, also known as Ginnie Mae, primarily do?

Ginnie Mae, or GNMA, primarily functions as a government-backed entity that facilitates the issuance of mortgage-backed securities (MBS). Its key role is to buy and pool loans from lenders that are insured by government programs, specifically those backed by the Federal Housing Administration (FHA) and the Department of Veterans Affairs (VA). By guaranteeing timely payment to investors, Ginnie Mae ensures liquidity in the mortgage market, making it easier for lenders to provide financing to homebuyers.

This mechanism supports the flow of capital into the housing market, which is particularly crucial for low-to-moderate-income borrowers who may rely on FHA or VA loans for homeownership. Thus, the correct choice underscores Ginnie Mae's mission in the secondary mortgage market and its contribution to making homeownership more accessible.

The other options do not accurately reflect the primary functions of Ginnie Mae. Insuring private mortgage insurance is a role more closely associated with private entities and not under Ginnie Mae's purview. Housing grants are typically offered through different programs and agencies, not directly by Ginnie Mae. Lastly, Ginnie Mae does not regulate real estate agents, as that responsibility falls under state real estate commissions and boards.