Which government association is known for guaranteeing high-risk mortgages?

The association known for guaranteeing high-risk mortgages is Ginnie Mae. This government agency is part of the U.S. Department of Housing and Urban Development (HUD) and focuses specifically on ensuring that low- and moderate-income individuals have access to affordable housing. Ginnie Mae achieves this by guaranteeing mortgage-backed securities, which are issued by approved lenders and backed by government-insured loans, such as those from the Federal Housing Administration (FHA) and the Veterans Administration (VA).

This guarantee encourages lenders to issue more high-risk loans because they know that the government backs those loans, reducing their risk of loss. Consequently, Ginnie Mae plays a crucial role in making housing more accessible, particularly for those who might struggle to qualify for traditional financing options. By providing this safety net, Ginnie Mae helps to stabilize the housing market and promote homeownership among segments of the population that might otherwise be underserved.