12/08/2023 | Press release | Distributed by Public on 12/08/2023 14:31
Helping lenders serve homebuyers and homeowners with affordable mortgages
Financing for quality, affordable rental housing in every market, every day
Reducing risk and enhancing housing finance liquidity
All Resources to Manage Financial Uncertainty
All Resources for Recovering from a Disaster
Recovery Assistance for Homeowners
Recovery Assistance for Renters
Fannie Mae's Economics and Strategic Research and Single-Family Capital Markets teams published a working paper introducing a new methodology that estimates and decomposes lender revenue for Fannie Mae guaranteed loans. Leveraging unique data, the authors reveal noteworthy insights into the relationship between individual loan economics and lender behavior. Among the new insights, the paper illustrates that the specified pay-up is critical to improving the economics of lower balance loans for lenders, which in turn improves access to credit for underserved borrowers. This market-based dynamic highlights how investor interests can support access to homeownership for underserved borrowers and families.
Low Balance Lending Economics: The Role of the Spec Pay-up (PDF)