A decade-old construction-to-permanent program has been canceled by Fannie Mae.
In seller Announcement 09-28 issued Friday, the secondary lender said it is eliminating the HomeStyle Construction-to-Permanent program.
The program was originally launched on a test basis in 1999, the announcement said. In 2002, the Washington, D.C.-based company opened it up to lenders experienced in construction lending.
“Because the product has not achieved substantial volume traction, coupled with the increased operational costs and risks associated with this product, Fannie Mae will be retiring the HomeStyle Construction-to-Permanent mortgage product,” today’s bulletin said.
Fannie noted, however, that its standard selling guide for construction-to-permanent financing remains in place.
Termination of the HomeStyle program was immediate. Any loans that have already been closed under the program must be purchased by Fannie by Nov. 30.
