Limited demand has Fannie Mae scaling back its menu of adjustable-rate mortgage programs.
Over time, the secondary lender has expanded ARM products available for whole-loan committing in eCommitting and eCommitONE. The gradual expansion was made to mirror ARMs available through the issuance of mortgage-backed securities.
But in Announcement SEL-2011-09, Fannie said it is streamlining the number of ARM products available for whole-loan committing.
The Washington, D.C.-based firm said that the move will align current whole-loan ARM offerings with current MBS market conditions.
“Many of the ARM products have had little or no whole loan delivery volume,” Fannie explained in the announcement.
ARM products that will remain available in eCommitting and eCommitONE include non-convertible and interest-only LIBOR-indexed products with a 30-year amortization and fixed terms of one, three, five, seven and 10 years.
ARMs available only in eCommitting are FHA loans with the CMT as the index and fixed terms of one, three, five, seven and 10 years. Also falling into this category is the MyCommunityMortgage LIBOR-indexed non-convertible 5/1 ARM.
The changes take effect on Dec. 1.
Sellers can continue to commit all currently available ARM products until Nov. 30, though the loans must be purchased by Fannie no later than Jan. 31, 2012.
