Printer Friendly

Freddie Mac announces changes to Loan Prospector, Home Possible.

Freddie Mac announced it will adjust its Loan Prospector[R] automated underwriting service and upgrade its Home Possible[R] suite of affordable mortgage products to help more low- and moderate-income borrowers qualify for mortgages that are eligible for purchase by Freddie Mac.

Specifically, Freddie Mac expects that more mortgages submitted to Loan Prospector will get an "accept" response as a result of the changes, according to Paul Mullings, senior vice president of single family sourcing at Freddie Mac.

The announcement is "the latest installment on the pledge we made to our lender customers to buy more of the loans they originate, and give them new ways to build their market share with Loan Prospector," said Mullings. "We believe the changes we are announcing further demonstrate how today's Freddie Mac is fulfilling its mission to expand home-ownership opportunities for America's families while delivering a consistently superior business experience to its lender customers."

Freddie Mac will also waive the Loan Prospector assessment fee when a "caution" response is returned on the first submission of a conforming, conventional mortgage, Mullings said. Caution responses are triggered by higher-risk mortgages that Freddie Mac purchases as well as by loans that do not meet the company's loan purchase guidelines.

"Simultaneously removing the fee and providing more 'accept' responses will enable our lenders to expand their business while discovering how many more of their customers qualify for Freddie Mac's most affordable mortgage products," Mullings added.

Mullings noted that it is not changing the way Loan Prospector assesses risk, but is expanding its purchases of higher-risk mortgages submitted through Loan Prospector that will meet the company's federal affordable housing goals.

Freddie Mac also said it is eliminating the $500 borrower cash contribution and pre-purchase homeownership education requirement for borrowers who use Home Possible mortgages to finance a single-family home. The Home Possible mortgage product line is designed to expand the home-buying power of borrowers with limited credit or down payment savings.

Freddie Mac is also cutting the cash contribution from 5 percent to 3 percent of the purchase price for Home Possible borrowers buying a three- to four-unit property.
COPYRIGHT 2006 Mortgage Bankers Association of America
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2006 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:TechNewz; Federal Home Loan Mortgage Corp.
Publication:Mortgage Banking
Geographic Code:1USA
Date:Aug 1, 2006
Previous Article:First Horizon unveils 'FAMUS' new technology for brokers.
Next Article:Expect 'repercussions' without final terrorism-insurance solution.

Related Articles
Mortgages in minutes.
Seeking common access.
Entering the Subprime Arena.
The new accountability. (Cover Report: Legislative/Regulatory).
Staking out new boundaries: last year brought unexpected news from Freddie Mac, which sparked renewed debate over regulatory reform of the secondary...
Freddie Mac streamlines A-minus process.
Freddie Mac's new approach.

Terms of use | Privacy policy | Copyright © 2020 Farlex, Inc. | Feedback | For webmasters