Release No. 99-08-15
August 9, 1999

Kansas City -- Fannie Mae (FNM/NYSE), the nation’s largest source of financing for home mortgages, recently announced an innovative new partnership with the Missouri Housing Development Commission (MHDC) to help more first-time buyers purchase their a home. The initiative, "First Home 1% Down," allows qualified, first-time home buyers to obtain conventional mortgages with a down payment of as little as one percent from the borrower’s own funds for the first time ever in Missouri. Through this loan underwriting pilot, Fannie Mae and MHDC hope to reach more borrowers by providing lenders with the means to address common impediments to homeownership; the lack of down payment funds and credit qualifications.

"Owning your own home is part of the American dream and the MHDC is proud to be a part of making the dream a reality for so many hardworking families throughout the state of Missouri," said Bob Holden, commissioner of MHDC and State Treasurer. "Public/private partnerships like this one are the key to helping hundreds of first time buyers take the first steps towards purchasing homes of their own."

A First Home 1% Down loan makes it easier for interested home buyers to qualify for conventional mortgage financing by allowing more option for credit qualifications. MHDC will provide qualified buyers with a grant of 4 percent to be used towards any down payment and closing costs. A First Home 1% Down Mortgage loan may be used for the balance of the home purchase, up to 97 percent of the price. All applicants must meet income guidelines established by the MHDC. Borrowers under this initiative will be required to participate in a homebuyer education session.

"Fannie Mae and MHDC created this flexible mortgage product to open more doors for more home buyers in Missouri," said Bill Brown, director of Fannie Mae's Kansas City Partnership Office. "This initiative will help those borrowers who need more flexible income and credit requirements and who have had trouble saving for the down payment."

"Working side-by-side with MHDC and our lender partners, we hope to put hundreds of people across Missouri on the path to homeownership," said Clifton Berry, director of Fannie Mae’s St. Louis Partnership Office.

First Home 1% Down Mortgage loans are available through the MHDC and its statewide network of participating mortgage lenders. For more information on the First Home 1% Down Mortgage, consumers may call MHDC at 816-759-6800 or on the Internet at www.mhdc.com.

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