No, Fannie Mae is not the little old lady who lives down the street. Not even close.
Fannie Mae is a private corporation that is the largest source of residential mortgage funds in the country. Since being privatized by congressional charter in 1968, Fannie Mae’s goal has been to increase the availability and affordability of homes for low-, moderate- and mid-income families.
With that goal in mind, Fannie Mae representatives are touring the territory this week to get a "first-hand look at the housing needs in the Virgin Islands," Delegate Donna Christian-Christensen said. On Monday, the representatives met on St. Croix with officials from the banking, real estate and other housing-related industries. They will do the same on St. Thomas on Tuesday.
"One of the charges we have is to reach under-served communities," said Jonathon Hughes, a Fannie Mae customer account manager out of Philadelphia. "And this is an under-served community."
Fannie Mae helps finance homes by purchasing mortgages from lenders. Fannie Mae can hold the home loans as an investment or package them and sell them on the securities market. Fannie Mae guarantees that investors will receive timely payment of monthly principal and interest on the mortgage-backed securities.
Fannie Mae uses the money it receives from the sale of loans, plus fees, to purchase more loans, continuing the process.
"This housing industry round-table presents an opportunity for our officials to discuss pertinent issues within our community with one of the nation’s leading mortgage institutions," Christensen said.
According to Hughes, the most difficult "issues" perspective homeowners in the Virgin Islands face as they start the loan process are hurricanes. "The biggest hurdle is hazard insurance," he said. "Other than the hazard issue, I don’t think there are any issues that we haven’t seen before."
Other issues some homeowners grapple with include not having enough money for a down payment or having a blemished credit history, said Lori Tavana, a Fannie Mae senior business manager. She said the organization has partnerships with Chase Manhattan Bank and Banco Popular, both of which do business in the territory. In addition, she said, Fannie Mae and the V.I. Community Bank are discussing a possible partnership.
Fannie Mae has been active for five years in Puerto Rico and has provided almost $1 billion in mortgages there, Hughes said. "We were in the same spot five years ago there as we are in the Virgin Islands now," he said. "We hope to have a similar impact on the Virgin Islands."
Tavana said the representatives' visit to the territory will help Fannie Mae understand how it can better serve the community, especially with the issue of hurricane insurance.
"I think one of the ways we can help is to provide information from other areas that can serve as a model so hazard insurance isn’t an obstacle in home ownership," Tavana said.
For more information, check out Fannie Mae’s website at homepath.com, or call 1-800-7-FANNIE.
