Landrieu Comments on New Fannie Mae Down Payment Policy

Posted by Sen. Mary Landrieu

June 4, 2008

Continues to push for reduction in fees for Louisianians with lower credit scores.

WASHINGTON - June 4, 2008 - (RealEstateRama) — United States Senator Mary L. Landrieu, D-La., today made the following statement regarding Fannie Mae’s announcement that it is reducing down payment requirements for the conventional, conforming mortgages it is willing to purchase or guarantee. This policy reverses the higher down payment requirements the company instituted last year in markets where home prices are declining. On April 17, Sen. Landrieu send a letter to the President and CEOs of Fannie Mae and Freddie Mac, expressing concern about the company’s decision to charge higher fees for home purchasers with less than a 740-point credit score.

“It is positive news that Fannie Mae is opening more doors to homeownership by reversing its policy requiring higher down payments in markets where home prices are declining — a situation that has affected much of the country.

“However, I remain concerned that Fannie Mae and Freddie Mac are charging higher fees for home purchasers with credit scores that are less than 740 points. The average credit score in Louisiana is about 663 points.

“At a time when our Gulf Coast communities are struggling to rebuild, these new fees could make it harder for middle and low-income Louisianians to purchase or sell a home. These fees may also exacerbate the problems in the real estate markets. I have urged Fannie Mae and Freddie Mac to explain the reason behind these fees, and hope for a swift response.”

Full copies of letters sent to Fannie Mae and Freddie Mac are available here: http://landrieu.senate.gov/news/Freddie_Fannie_credit_score_letters.pdf.

Share it: These icons link to social bookmarking sites where readers can share and discover new web pages.