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Bridges | Fall 2009

Fannie Mae Offers CRA-Targeted Investments

Fannie Mae has a CRA-Targeted Mortgage Backed Security (MBS) tailored specifically for depositories and other investors in community development.

Highlights of the CRA-Targeted MBS include:

It is fully customized to a bank’s specifications. Fannie Mae does not issue the MBS until the bank places an order to trade, specifying the assessment areas, the size of the investment and negotiated pricing.
Up to 100 percent of the loans backing each MBS pool can be made to borrowers with incomes below 80 percent of the area median income.
A geographic distribution of the loans can be defined to meet the bank’s specific CRA assessment area needs.
The CRA-Targeted MBS carries a guarantee of timely payment of principal and interest, like all Fannie Mae MBS, and is not subject to resale restrictions. The CRA-Targeted MBS will be issued under Fannie Mae’s standard security prefixes.

Banks around the country have found the CRA-Targeted MBS product especially useful in meeting their CRA investments needs in assessment areas in which there are few other investment opportunities, a Fannie Mae spokesman said.

For more information, contact Mary Beth Preuss at 1-800-752-0257.

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