Fannie Mae and the Department of Housing and Urban Development are congratulating themselves on boosting home ownership among minority Americans by putting together loan packages that give breaks to low and moderate income workers.

At a news conference, Housing Secretary Andrew Cuomo and Fannie Chairman Franklin Raines bragged that home ownership in the African American community has never been higher, and Raines took the opportunity to slap the Washington Post for a recent news story suggesting Fannie does little to support minority buyers.

"The Post story intimates that Fannie Mae does not support African American homebuyers," said Raines. "That story is simply wrong, and I am outraged by it. Fannie Mae's policies are to expand home ownership as aggressively as possible.

"The Post's implication that Fannie Mae has policies that exclude borrowing by blacks is neither supported by the article nor correct.

"During the 1990's, Fannie Mae grew to become the nation's single largest source of home financing for minority families."

Fannie Mae is, however, under investigation by HUD and Congress to determine if its Desktop Underwriter computer program has built in biases against minorities. Fannie has been required to turn over some 10 million loan application records to government authorities.

Nevertheless, Raines insists that when viewed in total, Fannie's record on minority lending is unimpeachable.

"In 1993, Fannie Mae provided $36.8 billion in mortgage financing for over 355,000 minority families," he said. "Of that, we financed $5.7 billion in mortgages for over 65,000 African American families.

"In 1999, Fannie Mae provided $45.6 billion in mortgage financing for nearly 412,000 minority families. And of that, we financed $8.4 billion in mortgages for over 86,000 African American families."

He said financing to African American family increased 31 percent during the Clinton Administration and 15 percent overall to all minorities.

Raines added, however, that Fannie intends to do more.

"The African American home ownership rate is still only 46.7 percent versus 73 percent for white families and 67 percent for the national as a whole," he said, adding that barriers minority families face include wealth, income, credit, information and discrimination.

He said Fannie was working to overcome each of those barriers with a variety of programs, including low-downpayment opportunities.

Raines said he wanted the joint news conference with HUD's Cuomo to "correct a misimpression" that he said the public may have gotten from the Post's stories. He emphasized that Fannie supported HUD's new affordable housing goals and had helped HUD set those targets.

Published: March 6, 2000

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