Time Right for FNM's 'Smart Commute' Plan
Unfortunately, lenders are often stuck on the suburban model, and consider only one-third of a borrower's income when they decide how much mortgage debt he or she can afford. Hare concludes that this makes urban housing "mortgage unaffordable" and pushes people to the car-reliant 'burbs. He calls it "transportation redlining."
The SmartCommute program was meant to address this imbalance. For borrowers willing to buy a home within a quarter mile of a public bus stop or half a mile of a commuter rail stop, lenders would calculate the savings from using public transit and consider it additional money that could go toward a mortgage, thereby increasing urban-dwellers' buying power.
While the program is still theoretically available from Countrywide Financial (CFC) and smaller regional lenders, a public relations contact at Fannie Mae had never heard of it and even after some digging couldn't send me information about it--a sign of how much they've let it wither.
(Interested consumers can call Fannie Mae at 800-732-6643.)Here's why it's time to actively revive it:
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