Magazine article American Banker

Fannie, Freddie Vow $440B Boost in Minority Loans

Magazine article American Banker

Fannie, Freddie Vow $440B Boost in Minority Loans

Article excerpt

Fannie Mae and Freddie Mac promised Monday to increase their commitment to purchase mortgages made to minority borrowers by $280 billion and $160 billion, respectively, by 2009.

The announcement came as President Bush launched an effort to increase the number of minority homeowners in the country by 5.5 million by the end of the decade.

In a speech delivered at an Atlanta church the President outlined several steps he wants the administration to take. In addition to the extra $440 billion being directed to minority borrowers by the government-sponsored enterprises, he said that there is a need for simplification of the homebuying process and an increase in financial literacy programs directed at unsophisticated homebuyers.

The President also urged faith-based organizations and other local groups to help remove social barriers that now block some Americans from owning their own homes.

The announcement that Fannie would buy more mortgages made to minority borrowers came in a letter from chief executive officer Franklin D. Raines to President Bush.

The letter, dated June 13 and released to the press Monday, also commits Fannie to several other steps, including the creation of a mortgage product aimed at meeting the needs of recent immigrants, another of the President's goals.

Freddie announced its increased commitment to minority borrowers in a press release Monday. The release highlighted the GSE's "Catch the Dream" program, a set of 25 initiatives aimed at increasing minority homeownership. …

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