According to a representative from Fannie Mae, their purpose is to be certain that borrowers are able to maintain their loans and stay in their homes for as long as they wish, while helping their lenders make a variety of different loan products available for those borrowers who qualify. In order to obtain an adjustable rate mortgage with a five year or less original period, Fannie Mae's requirements state that the borrower must be qualified at the larger of the note rate with an addition of two percent, or the fully indexed rate.
They will also continue making an interest only mortgage accessible, but will alter the requirements for qualification. The loan to value ratio shall not be greater than seventy percent, the borrower's credit score cannot be lower than 720, and they are required to have at least twenty-four months of reserve liquid assets that would remain after the loan has closed.
Mortgages that do not conform to the new guidelines must be bought as entire loans no later than the 31st of August, 2010 or placed into Mortgage Based Securities pools that have dates of issue on or prior to August 1st, 2010.
