Fannie Mae Mortgage Tips

From the Superpages.com

A Fannie Mae mortgage is a mortgage issued by the Federal National Mortgage association, which is a government sponsored entity (GSE). Fannie Mae was established in 1938 as a federal agency. In 1968, Fannie Mae was chartered by Congress and became a private shareholder-owned company. Fannie Mae was run in this manner until September of 2008, when the Federal Housing Finance Agency (FHFA) was appointed as conservator. At this time, the Department of Treasury provided up to $100 billion in capital to be used on an as-needed basis to ensure Fannie Mae could continue providing funds for the housing market. Fannie Mae’s mission is to make home ownership more affordable to everyone in America.

What Are the Types of Fannie Mae Mortgage?

Fannie Mae does not provide mortgages, but instead works with bankers and brokers to help these lenders provide funds for people with less than stellar credit. In working with its partners, Fannie Mae provides a series of Fannie-Mae mortgage products. However, the Fannie Mae charter specifies certain requirements for the two major types of loans they offer: conforming loans and jumbo loans.

Fannie Mae Mortgage Conforming Loans

Fannie Mae’s charter defines a conforming loan as a loan that fills within certain loan limits. As of January 2009, new loan limits are in effect. There are two sets of loan limits, one upper limit for mortgages in most areas and another for loans in high-coast areas:

• A conforming Fannie Mae mortgage loan must be under $417,000 for a single family unit in the contiguous states, the District of Columbia and Puerto Rico
• In high cost areas, Fannie Mae may authorize a Fannie Male loan up to $625,000.
• In Alaska, Guam, Hawaii and the U.S. Virgin Islands, conforming Fannie Mae mortgage loans encompass loans up to $625,500.
• In high cost areas of Alaska, Guam, Hawaii and the U.S. Virgin Islands, a conforming Fannie Mae mortgage loan can be up to to $938,250.

Fannie Mae mortgage loans that exceed these limits are referred to as jumbo loans and have different requirements.

Payment Structure for Fannie Mae Mortgage Loans

Fannie Mae offers several different payment structures for the mortgage loans they back:

• Biweekly mortgage: Under this accelerated payment structure, the homeowner pays on his mortgage every 14 days. The benefits of this mortgage include multiple lower payments and faster payoff of the principal. It is a fixed-rate mortgage. Payments are generally deducted from your bank account. Paying biweekly can save you thousands of dollars in interest and you can pay off a 30 year mortgage in approximately 22-years.
• Community Solutions: This mortgage has no minimums for borrower contributions. It is designed for teachers, police, firefighters and healthcare workers. Some of the other benefits include 40-year term mortgages and lower initial monthly payments via an interest only loan (for the first five or ten years). Loan to value ratios are up to 100 percent if the borrower is buying a single unit property. This loan may also be available to those with nontraditional credit histories
• Community HomeChoice: This loan is tailored to borrowers with a disability or with a family member that has a disability. The perks for this loan are similar to the Community Solutions mortgage.

Fannie Mae also provides funding for standard 30-year fixed rate mortgages, 15-year fixed rate mortgages, 20-year fixed rate mortgages and 40-year fixed rate mortgages. You canvisit the Fannie Mae website to learn more about Fannie Mae mortgage loans.