Tags: Fannie-Mae | No | Down-Payment | Mortgages

Fannie Mae Returns to No Down Payment Mortgages

Tuesday, 07 Sep 2010 07:04 AM

Home foreclosures are still booming, anticipated to top two million this
year — but no money down loans are back.

The government sponsored mortgage entity Fannie Mae has started Affordable Advantage, a new program for first-time homebuyers, in Idaho, Massachusetts, Minnesota and Wisconsin.

Fannie Mae buys the loans as securities from the states’ own housing agencies, which have bought the loans from lenders. Since the federal government now owns 80 percent of Fannie Mae, taxpayers are on the hook if the loans go bad.

“These aren’t the loans that led us into the mortgage crisis,” Moody’s vice president William Fitzpatrick told The New York Times. “They have a mission to put people in homes and keep them in homes.”

According to Janis Smith, a spokeswoman for Fannie Mae, “income is fully documented, monthly payments are fixed, credit score requirements are generally higher, and borrowers must be thoroughly counseled on the home-buying process and managing their mortgage debt.”

The mortgages on offer are 30-year fixed and require homeownership counseling and a credit score of 680 or above in three states, with Massachusetts requiring a score of at least 720 and at least $1,000 of buyers’ own money.

Fannie Mae expects the program will remain small.

The Dayton Daily News reports that even churches are not exempt from the tidal wave of foreclosures.

Since December 2007, the number of foreclosure proceedings brought against churches has tripled compared with the previous seven years, according to a review of the Thomson Reuters Westlaw legal database, which tracks foreclosures.

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Home foreclosures are still booming, anticipated to top two million this year but no money down loans are back. The government sponsored mortgage entity Fannie Mae has started Affordable Advantage, a new program for first-time homebuyers, in Idaho, Massachusetts,...
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2010-04-07
Tuesday, 07 Sep 2010 07:04 AM
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