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U.S. Senator Charles E. Schumer and Mayor Anthony M. Masiello Join CitiMortgage and Fannie Mae to Announce New Partnership to Provide $200 Million in Affordable Mortgage Lending to Families in Erie and Niagara Counties

U.S. Senator Charles E. Schumer and Mayor Anthony M. Masiello Join CitiMortgage and Fannie Mae to Announce New Partnership to Provide $200 Million in Affordable Mortgage Lending to Families in Erie and Niagara Counties

Published 04-30-01

Submitted by Fannie Mae

Hundreds of low- and moderate-income, minority, new immigrant, and other underserved households in Erie and Niagara Counties will benefit from a new partnership announced today by Wilbur A. McKesson, Jr., national sales director of emerging markets for CitiMortgage, Inc., a subsidiary of Citigroup (C/NYSE) and officials from Fannie Mae (FNM/NYSE), the nation’s largest source of financing for home mortgages. The partnership will provide $200 million in affordable mortgage lending in New York’s Erie and Niagara Counties over the next five years.

"The need to increase the homeownership rate among minorities and new immigrants in Erie and Niagara Counties has never been greater," said U.S. Senator Charles E. Schumer (D-NY). "I applaud CitiMortgage and Fannie Mae for joining forces on this important initiative to help make the American dream a reality for more hard-working families."

"Homeownership provides a real opportunity to invest in a community and in the future," said Buffalo Mayor Anthony M. Masiello. "I commend CitiMortgage and Fannie Mae for working together to make homeownership more affordable for our community’s hard-working families."

"I want to commend Fannie Mae and CitiMortgage for their commitment to affordable housing," said State Superintendent of Banks, Elizabeth McCaul. "Both Governor Pataki and I are committed to helping as many New Yorkers as possible achieve the dream of homeownership. The New York State Banking Department has many services we offer to consumers for free to help them through the homebuying process. I want to encourage families in New York to take advantage of this great opportunity offered by Fannie Mae and CitiMortgage."

"Citibank recognizes the tremendous growth in the number of low- and moderate-income individuals in Erie and Niagara Counties wanting to purchase homes, along with the need to make more affordable mortgage products available to them," said Thomas R. Quinn, Citibank’s president in New York State. "We are pleased that CitiMortgage and Fannie Mae have joined forces in this partnership and look forward to supporting their efforts through our Citibank Financial Centers located in these areas."

"Our two companies are both focused on the mission of helping families achieve the dream of homeownership and making a tangible difference in the communities we serve," said CitiMortgage’s McKesson. "Through this partnership in Erie and Niagara Counties, we will increase our commitment to provide mortgage tools for low- and moderate-income individuals, as well as to offer mortgages that encourage neighborhood revitalization, and increase homeownership opportunities for new immigrants and minorities."

This commitment represents a major increase in the affordable lending business of CitiMortgage Inc., and will transform the way the company serves emerging markets. To achieve this goal, CitiMortgage has committed to originate and Fannie Mae has committed to purchase at least $200 million in innovative and affordable mortgage loans. At the center of this partnership is the expansion and introduction of flexible mortgage products that address the unique needs of low- and moderate-income borrowers, minority home buyers, new immigrants, and other underserved populations.

"Fannie Mae is proud to join CitiMortgage in this new initiative," said Robert D Bannister, director of Fannie Mae’s Western & Central New York Partnership Office. "CitiMortgage and Fannie Mae share a deep commitment to create homeownership opportunities for more residents in Erie and Niagara Counties, especially for those historically underserved by the housing finance system."

This partnership is part of a $12 billion national initiative to provide flexible mortgage products through all CitiMortgage affiliates and their business partners. In addition to Erie and Niagara Counties, the initiative includes concentrated marketing efforts in several major metropolitan areas including: the New York City/Tri-State Area; Monroe County, NY; the Miami/South Florida area; Chicago; Los Angeles/Orange County; Washington, DC and the Baltimore region; Southwestern and Central Connecticut; and the San Francisco Bay Area.

This innovative partnership is part of Fannie Mae’s nationwide $2 trillion American Dream Commitment to increase homeownership rates and serve 18 million targeted families by the end of the decade. Specifically, this initiative is part of Fannie Mae’s House Western and Central New York, a five-year, $2 billion investment strategy to finance affordable housing for 22,000 families in the region.

To ensure the success of this new partnership, CitiMortgage and Fannie Mae join forces with key national organizations such as Local Initiatives Support Corporation (LISC), the National Association of Hispanic Real Estate Professionals (NAHREP), and the National Association of Real Estate Brokers (NAREB – Realists), with a new partnership being forged with the National Urban League (NUL). Locally, CitiMortgage and Fannie Mae work with West Side Neighborhood Housing Services, a key partner in Erie and Niagara Counties, to reach targeted audiences.

These organizations and others will work with CitiMortgage and Fannie Mae to develop and implement marketing strategies to increase lending to minority and new immigrant home buyers and to promote homeownership in Erie and Niagara County.

Unique mortgage products to be offered under this initiative include:

CitiAffordable Mortgage Program and CitiAffordable Purchase Assistance Program – offer low-down payment options and flexible qualifying criteria. These marquee CitiMortgage products take into consideration the fact that lower-wealth borrowers experience significant challenges in accumulating funds for down payment and closing costs. The CitiAffordable Mortgage Program also includes a minimum 3 percent down payment for two-unit properties.

MyCommunityMortgageSM pilot - a suite of flexible, high loan-to-value (LTV) Fannie Mae mortgage options for one- to four-unit properties, with customizable features that will help CitiMortgage meet the needs of low- and moderate-income borrowers in Erie and Niagara Counties with incomes at or below 100 percent of the area median income ($46,900). The products that CitiMortgage will be offering include:

Community 97SM – a 97 percent (LTV) mortgage with flexible credit guidelines. The core features, which can be customized, include a minimum contribution of 1 percent or $500, whichever is less (from the borrower’s own funds), with the remainder coming from flexible sources, no monthly reserves, and a higher single qualifying ratio.

Community 100 PlusSM – a new 100 percent LTV mortgage with flexible credit guidelines for borrowers with limited cash resources. The core features, which can be customized, include a minimum contribution of 1 percent or $500, whichever is less (from the borrower’s own funds), no monthly reserves, and a higher single qualifying ratio.

Community 2-FamilySM – a flexible, affordable mortgage for owner-occupants of two-unit homes with a down payment of as little as 3 percent from the borrower’s own funds.

Community 3-4 FamilySM – a flexible, affordable option to owner-occupants of three- and four-unit homes with a down payment of as little as 5 percent from the borrower’s own funds.

Flexible Qualifying Guidelines for Immigrants – allows working non-permanent resident immigrants to participate in a full array of flexible mortgage products. Fannie Mae’s flexibilities include consideration of alternative sources of qualifying income such as boarder income and part-time employment. Flexible consideration of cash-on-hand and non-traditional sources of credit also is allowed.

Working MortgageSM – offers special down payment and flexible qualifying guidelines to borrowers who set up an automatic deduction of the mortgage payment that matches the timing of the borrower’s weekly or biweekly paycheck. This automatic deduction results in faster amortization of the mortgage, which accelerates the build up of equity.

Timely Payment RewardsSM – allows borrowers with past credit difficulties to obtain a mortgage rate up to two percentage points lower than credit-impaired borrowers typically pay. After 24 monthly payments without a delinquency, the borrower’s mortgage rate is automatically reduced by up to 1 percentage point.
CitiMortgage, Inc., specializes in nationwide residential home mortgages through retail, wholesale, telesales, and corporate loan origination channels. CitiMortgage and its affiliates rank among the Top 10 mortgage originators nationwide. In 2000, origination volume was $19.7 billion and servicing volume was $96.6 billion, respectively. CitiMortgage is an Equal Housing Lender.

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