The following Letter Type B, or variations thereof, was submitted by individuals or entities.

Letter Type B:

I would like to take this opportunity to comment on the proposed changes to FINRA Rule 4210(Margin Requirements). 

As A GNMA Multifamily Seller/Servicer for over 30 years, we can attest the current securities market has operated successfully in its current format, with Mortgagors currently posting a 0.5% Good Faith Deposit to mitigate the risk of a traded security not being delivered.  In the past 10 years, Davis-Penn has sold over $2 Billion in GNMA securities, and we have only had one security that was not delivered.  I am sure that you will find this to be true of other HUD Multifamily lenders.   There has been no data provided to us on defaulted deliveries that would indicate a need for additional risk mitigation. This is a financial burden that will punish our borrower’s ability to provide housing across the nation and will not serve any benefit to the security transaction. 

A number of our trades are with smaller, regional investment firms that don’t have the infrastructure in place to monitor margin accounts, thus our pool of Investors could shrink.  A smaller Investor trading pool will ultimately mean higher interest rates for Mortgagors.  As a smaller Mortgage Banking firm, we don’t possess the capital to post margin accounts for every security trade we have outstanding, and the proposed rule change will adversely affect our ability to originate construction and substantial rehabilitation loans, as these proposed margin accounts would be held until the delivery of the Permanent Loan Certificate, which could take up to two years.

http://www.sec.gov/comments/sr-finra-2015-036/finra2015036-10.htm