YUMA, Ariz. – Fannie Mae, in an effort to improve housing conditions and expand homeownership in Arizona's four border counties of Cochise, Pima, Santa Cruz, and Yuma, has announced an ambitious and comprehensive strategy to increase the supply of for-sale and rental housing, improve substandard housing conditions, and offer new mortgage financing pilots created specifically to meet the unique needs of border-region borrowers. The Arizona Border Initiative will serve low- to moderate-income minority families, Native Americans, immigrants, migrant farm workers, and other underserved populations in border communities. It is part of Fannie Mae's national American Dream CommitmentT to invest $130 billion in targeted underserved rural regions in the U.S., including the U.S.-Mexico border area known as Colonia. Joining Fannie Mae at the announcement on Aug. 26 were U.S. Rep. Paul Grijalva (D-Ariz.), border-area mayors from Yuma, San Luis, and Somerton, and representatives from the Cocopah Tribe and AEA FCU. Marking this relationship, AEA FCU announced it will offer three new variances as part of a new $20 million, two-year lending partnership with Fannie Mae. The CU is the first to partner with Fannie Mae on an alliance of this kind. PMI Mortgage Insurance Co. will be the exclusive mortgage insurance provider for these efforts. They include three new place-based mortgage pilots that have been created to reach and serve local homebuyers, allowing them to refinance and renovate substandard housing. In addition, new mortgage financing options for Native Americans will be pursued: * Border Region MyCommmuityMortgageT pilot offers expanded credit flexibilities that address unique credit issues of low-income border populations who experience high rates of unpaid medical collections and lack credit history. Fannie Mae will no longer consider unpaid medical collections that don't exceed $5,000 when determining credit worthiness for a conventional mortgage loan, and will also accept a Verification of Rent form from landlords to show consistent payment practices, rather than 12 months of canceled checks that are typically required to substantiate a borrower's rental payment history. * Border Region Sweat Equity pilot allows borrowers to contribute labor – or sweat equity – in lieu of cash contribution to pay for as much as 25% of the purchase of the as-completed value of the home. * Border Region Renovation pilot was created to renovate and transform substandard housing by creating one loan for the mortgage and the costs of substantial renovation of the property. The renovation costs can represent up to 75% of the as-completed value of the property. * For Native Americans living on the Cocopah reservation, Fannie Mae has purchased $1.6 million in U.S. Department of Housing and Urban Development Section 184 loans from the Cocopah Nation to offer more affordable financing options to purchase a home on sovereign tribal lands. AEA President/CEO Ken Bredemeyer said the CU's $20 million partnership with Fannie Mae demonstrates its commitment to help improve the lives of families living in the border region through housing, and its partnership with Fannie Mae "is a resounding example of the people helping people credit union philosophy in practice." "To be the first credit union in the United States to be selected for a Fannie Mae partnership of this kind is a great honor," said AEA FCU's EVP Denise Sweet-McGregor. "As a community chartered credit union spanning two counties, we are always searching for new programs to match the needs of our economically diverse membership. Our alliance with Fannie Mae enables us to break down barriers, lower costs, and increase access to homeownership to member families along our borders." AEA FCU has a long-standing service commitment to the Hispanic community. In 1992, the CU opened a branch in the city of Somerton, located near Mexico, and it remains the only financial institution serving that community. In addition, the credit union's new AEAExpress Mobile Branch travels to border communities bringing financial services to underserved border regions in Arizona. Noting that "homeownership is the largest generator of personal wealth for American families, especially for minority populations," Rep. Grijalva said, "This comprehensive housing initiative will go a long way towards increasing the supply of new affordable housing, increasing funds for educating the population in their native languages, and creating entirely new mortgages for borrowers who may not qualify through traditional sources." -

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