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FANNIE MAE SECURITIZES $1.3 BILLION OF CALIFORNIA ARMs FROM AMERICAN SAVINGS BANK; 75 PERCENT ARE CENTRAL CITY, LOW-INCOME OR MINORITY LOANS

 WASHINGTON, Sept. 29 /PRNewswire/ -- The Federal National Mortgage Association (Fannie Mae) (NYSE: FNM) announced today that it has securitized $1.3 billion in adjustable-rate mortgages (ARMs) from American Savings Bank of Irvine, Calif. Seventy-five percent of these seasoned, residential ARM loans were made to central city, low-income or minority borrowers in California.
 "American Savings Bank is proud of its lending record in the central cities and is pleased to join with Fannie Mae in this program," said Mario Antoci, chairman and chief executive officer of American Savings Bank.
 The $1.3 billion American Savings Bank ARMs were exchanged for Fannie Mae Mortgage-Backed Securities (MBS), which American will hold in its MBS portfolio.
 "To many lenders, these are loans that Fannie Mae is not supposed to be interested in," said John Fulford, regional senior vice president and head of Fannie Mae's Western Regional Office in Pasadena, Calif. "At one time American felt that way, so we said, 'Show us the loans you think we won't buy.' When they did, we found they had loans we were interested in, and they found we were more flexible than they had believed. The result is a deal good for everyone: for Fannie Mae and our investors, for American and for central cities."
 "This also sends a positive signal to Californians that confidence remains in the California real estate market; and for lenders, there is plenty of good business out there in these urban neighborhoods," said Antoci.
 The $1.3 billion ARMs are indexed to the Office of Thrift Supervision 11th District Cost of Funds, with an average loan size of approximately $122,600. All the loans were made within the last four years: 87 percent of the mortgages were originated between 1991 and 1993; 62 percent were originated
between 1992-1993; and 38 percent were originated between 1989 and 1991. More than one-third of these loans were made to borrowers at or below their area's median income, while more than half were made to people who live in central cities.
 According to Fulford, Fannie Mae applied its flexible underwriting guidelines to American Savings Bank's portfolio of affordable housing loans, which included increasing housing debt ratios from 28 percent up to 33 percent and total debt ratios from 36 percent to 38 percent.
 American Savings Bank, with more than $17 billion in assets, is a leading provider of home mortgages in California.
 Fannie Mae is a congressionally chartered, shareholder-owned company and the nation's largest source of home mortgage funds.
 -0- 9/29/93
 /CONTACT: Kevin Hawkins of Fannie Mae, 202-752-6720, or Joe Rookard of American Savings Bank, 714-252-4210/
 (FNM)


CO: Federal National Mortgage Association; American Savings Bank ST: District of Columbia, California IN: FIN SU:

MH-DC -- DC035 -- 6843 09/29/93 13:04 EDT
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Publication:PR Newswire
Date:Sep 29, 1993
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