Fannie Mae and the Federal Home Loan Bank (FHLB) of Chicago have entered into a new partnership whereby Fannie Mae will purchase 30- and 15-year fixed-rate mortgages from the bank.
Fannie Mae will purchase loans channeled through FHLB Chicago's Mortgage Partnership Finance (MPF) program, which provides funding to hundreds of member community banks, thrifts and other financial institutions to ensure the availability of affordable mortgages.
By providing this additional source of funding for MPF mortgages, Fannie Mae helps both organizations meet national calls to expand their service to the market and provide more liquidity, according to Fannie Mae.
While the arrangement is currently available to FHLB Chicago member institutions through the MPF Xtra product, similar institutions that participate in the MPF program may seek to offer the MPF Xtra option to their members in the future.
Source: Fannie Mae