Housing Bubble
Bank One and Fannie Mae to help homeownership grow in Michigan
March 14, 2003
DETROIT--(BUSINESS WIRE)--March 14, 2003--Mayor Kwame Kilpatrick and U.S. Rep. Carolyn Cheeks Kilpatrick (D-MI) today joined Bank One and Fannie Mae - two leading national players in home mortgages - to tell the community and its leaders how a $12.5 billion community lending alliance will plant seeds that will grow homeownership here.
Fannie Mae , the nation's largest source of financing for home mortgages, has agreed to purchase eligible loans originated through the partnership, making it possible for Bank One to generate additional mortgages.
Bank One will offer mortgages for both single- and multi-family homes. The bank will focus at least 25 percent of the total commitment to increasing homeownership among minorities. The bank also will target disabled persons, individuals who receive Section 8 government rent subsidies and community development efforts.
Minority families, women-headed households, immigrants and people with disabilities are among the underserved individuals who will obtain affordable mortgage financing. Bank One views mortgages as a key element in customer relationships and will offer customized mortgage products that:
- Require little or no down payment
- Feature flexible credit qualifications and/or
- Eliminate the cost of mortgage insurance
"Bank One wants to encourage homeownership by helping individuals who have steady incomes but struggle to gather funds for a down payment," said Dick Wade, president of Bank One in Michigan. "By increasing homeownership among underserved people, we can build strong neighborhoods and improve our communities. Our $12.5 billion commitment will help Michigan families put down roots and Michigan communities grow stronger. Families also can develop the personal wealth and financial security that is a natural outgrowth of owning one's own home."
Mayor Kilpatrick said that the creation of affordable housing is a priority in the city because "all Detroit residents deserve homes that they can afford and be proud of.
"Housing is the cornerstone to strong communities," he said. "This new partnership will provide secure roots for families - creating safer neighborhoods through neighborhood pride and involvement."
"We are proud to work with Bank One to help more families and individuals on the path to homeownership," said Rita Hillman, director of Fannie Mae's Michigan Partnership Office. "This multibillion dollar lending alliance is designed to increase affordable housing opportunities for minority and other underserved borrowers and is a positive step to help close the homeownership gaps that exist today."
Fannie Mae also will help Bank One develop strategies to encourage the bank's corporate customers to provide their own employees with down-payment assistance. Bank One currently offers a $2,500 grant to its workers who meet income and other employment guidelines.
Bank One also offers down payment assistance grants of up to $2,000 to eligible Detroit area borrowers depending on need. The bank will provide grants automatically to qualified loan applicants. In 2003, Bank One will offer up to $100,000 in down payment assistance grants in Metro Detroit.
To help families understand the responsibilities and advantages of homeownership, Bank One and Fannie Mae will work closely with nonprofit counseling organizations and national community organizations that are committed to providing housing opportunities for underserved communities.
"Homeownership is the key to wealth creation for families in this nation. African American homeownership continues to lag behind," said Rep. Kilpatrick. "This new commitment from Bank One and Fannie Mae will be a critical part of our effort to increase minority homeownership in the City of Detroit, the 13th Congressional District and across the nation."
Detroit is among three Bank One markets - including Chicago and Phoenix - where Bank One and Fannie Mae's affordable housing initiative will launch. The program will expand to other markets in the 14 states where Bank One has branches by the end of 2003.
Fannie Mae is working to shrink the nation's "homeownership gaps" through a $2 trillion "American Dream Commitment" to increase homeownership rates and serve 18 million targeted American families by the end of the decade. Since 1968, Fannie Mae has provided $4.5 trillion of mortgage financing for more than 49 million families.
To learn more about the initiative, consumers may call Fannie Mae's Consumer Resource Center at 1-800-7FANNIE (1-800-732-6643), Monday through Friday, from 9:00 a.m. to 5:00 p.m. EST. To apply for a mortgage, call Bank One at (313) 225-3553 between 8 a.m. and 5 p.m. weekdays.
