In an attempt to stimulate more housing loan lending, Freddie Mac has extended its eight-year contract with independent banks, enabling over 5,000 lenders more access to funds for additional home loans.
The programme is aimed at independent community banks, which are facing restrictive lending guidelines attributed to tougher housing underwriting criteria required by Fannie Mae and Freddie Mac, the country’s two housing loan giants.
Initially launched in 2003, the programme is supported by the Independent Community Bankers of America (ICBA) organisation. The expansion has renewed the alliance between the two organisations through to 2012.
“Our alliance with ICBA underscores our commitment to the special needs of our community lender customers and to make home possible in their communities,” said Mike Koch, Vice President of Offerings at Freddie Mac.
The programme includes a federal attempt to provide more mortgage support for home owners taking part in rural housing programmes, most of which have been devastated by the collapse in real estate.