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FANNIE MAE AND CONNECTICUT LENDERS TO MAKE AVAILABLE $100 MILLION IN AFFORDABLE MORTGAGE LOANS UNDER CHAMP PROGRAM

 WASHINGTON, June 16 /PRNewswire/ -- The Federal National Mortgage Association (Fannie Mae) (NYSE: FNM), the nation's largest source of home mortgage funds, today announced that it will invest as much as $100 million in affordable home loans made by 12 Connecticut lenders for low- and moderate-income borrowers under the Connecticut Home Buyers Affordable Mortgage Program (CHAMP).
 Using CHAMP, first-time home buyers whose incomes do not exceed 100 percent of their area median (ranging from $30,520 for a single person living in the New London/Norwich area, to $73,800 for a family of four in the Stamford area) may qualify for a Fannie Mae Community Home Buyer's Program mortgage and are eligible for second mortgages provided by the Connecticut Department of Housing that provide assistance with down payments and closing costs. Together, the two elements of the financing will permit families to buy a home for as little as three percent down.
 The combination of the low down payment Community Home Buyer's Program with flexible qualification guidelines and the CHAMP second mortgage also allows potential home buyers to qualify for mortgage financing with significantly lower incomes than traditional underwriting guidelines will allow.
 Gov. Lowell P. Weicker Jr., who initiated the CHAMP program in February, said, "Fannie Mae's investment in Connecticut shows that CHAMP is a valuable public-private partnership that makes the dream of homeownership more accessible to our state residents."
 Geoffrey Smith, Fannie Mae's Philadelphia-based northeastern regional director of housing impact, said, "We are delighted to work as partners with Connecticut lenders and the Connecticut Department of Housing to provide access to affordable, flexible mortgage funds." According to Smith, consumers will have immediate access to information on the lenders making the loans by phoning 1-800-7-FANNIE.
 The Community Home Buyer's Program, which has resulted in nearly $4 billion in mortgages for more than 50,000 low- and moderate-income families nationwide since 1991, offers a mortgage option with down payments as low as three percent of a buyer's own funds, as well as flexible qualification guidelines. Important loan features include:
 -- Home buyers may devote up to 33 percent of their income to
 housing expenses, rather than the standard 28 percent; and up to
 38 percent of their income on general long-term obligations,
 instead of the typical 36 percent.
 -- For those with brief credit histories, use of alternative means
 of demonstrating good credit, such as utility payments and rent
 paid to landlords, is acceptable.
 -- By combining a first mortgage for up to 75 percent of the value
 of the property with a CHAMP second mortgage for 22 percent of
 the value of the property, home buyers need as little as
 3 percent of their own funds to purchase a house.
 -- Home buyers with family incomes up to 100 percent of the area
 median are eligible.
 -- Home buying education/counseling is required for borrowers.
 Twelve mortgage lenders throughout the state have committed to originate and sell to Fannie Mae a combined total of up to $100 million of first mortgages under this program. These lenders are:
 Advest Bank
 Bristol Mortgage
 CenterBank Mortgage
 Liberty Bank
 Mechanics Savings Bank
 New Haven Savings Bank
 The New Milford Bank & Trust Company
 New Milford Savings Bank
 People's Bank
 Ridgefield Bank
 The Savings Bank of Rockville
 Shawmut Mortgage
 Fannie Mae is a congressionally chartered, shareholder-owned company and is the nation's largest source of funds for home mortgages.
 -0- 6/16/93
 /CONTACT: Tom Marder of Fannie Mae, 202-752-7608/
 (FNM)


CO: Federal National Mortgage Association ST: Connecticut IN: FIN SU: PDT

KD-MH -- DC011 -- 2582 06/16/93 11:37 EDT
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Date:Jun 16, 1993
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