Broadway Federal Bank Approved to Deliver $25 Million of Small Multifamily Loans to Fannie Mae.Business Editors LOS ANGELES--(BUSINESS WIRE)--Dec. 20, 2000 Broadway Financial Corp. (the "Company") (Nasdaq:BYFC), the holding company of Broadway Federal Bank, f.s.b. ("Broadway Federal" or "Bank"), today announced that Fannie May
See: New York Stock Exchange :FNM FNM Faith No More (band) FNM Fábrica Nacional de Motores (Brazilian truck/motor company)) FNM Free National Movement (Bahamas) FNM Foot and Mouth ), the nation's largest source of financing for home mortgages and multifamily financing, has approved Broadway Federal as a pilot lender to deliver $25 million in small multifamily loans Multifamily loans Loans usually represented by conventional mortgages on multi-family rental apartments. . Paul C. Hudson, Broadway Federal President/CEO, stated, "This is the first Fannie Mae Fannie Mae: see Federal National Mortgage Association. pilot for which the Bank has received approval to participate." Hudson went on to note, "Fannie Mae has exhibited a commitment to addressing the liquidity needs of small lenders, as well as the credit needs of small multifamily borrowers and low-income minority communities." Seventy-four percent (74%) of the Bank's total loan originations for the past 24 months have been small multifamily loans. Development of the Fannie Mae pilot was crucial to the Bank's liquidity and asset allocation Asset Allocation The process of dividing a portfolio among major asset categories such as bonds, stocks or cash. The purpose of asset allocation is to reduce risk by diversifying the portfolio. objectives. Fannie Mae committed $25 million to the pilot with terms that include 10-year fixed rate loans with 30-year amortization on multifamily properties with five to 50 units, maximum loan-to-value of 75%, and loan limits from $250,000 to $1.5 million. Broadway Federal determined that the credit risk profile of small multifamily loans had improved as a result of better managerial expertise of the borrowers and a strong economy that produced lower vacancy rates and growth in rents. In addition, multifamily loan products produced higher interest margins and were often originated on an adjustable rate Adjustable rate Applies mainly to convertible securities. Refers to interest rate or dividend that is adjusted periodically, usually according to a standard market rate outside the control of the bank or savings institution, such as that prevailing on Treasury bonds or notes. basis. "Fannie Mae worked with Broadway Federal to develop a pilot that was competitive and met local market demands," said Heidi McKibben, vice president of Multifamily Lending for Fannie Mae. "Fannie Mae looks forward to working with Broadway Federal to develop a strong and successful relationship that benefits small multifamily borrowers in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. and the many families that they house." This news release contains certain forward-looking statements that are subject to various factors that could cause actual results to differ materially from such statements. Such factors include, but are not limited to, the possibility that the repurchase transaction discussed herein may not be consummated or may be delayed due to changing economic, market or business conditions. |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion