Executive Summary - 13 May 2008

By Christian Mullins

Executive Summary:

Fannie Mae has announced four initiatives designed to help both current and prospective homeowners. They are: 1. Allowing homeowners current on their mortgage to refinance up to 120% of their home value. 2. Provide $10 billion in financing to qualified first time home buyers. 3. Rent-to-own programs in hard hit real estate markets. 4. Fannie Mae will immediately begin to purchase jumbo-conforming loans at the same price as other conforming loans.

As financial institutions and government agencies become more conservative in their lending practices, Peer-to-Peer (P2P) lenders like Prosper.com and Virgin Money USA are attempting to fill the gap. While it’s still suggested that students exhaust traditional student loan sources first as the rate will generally be more reasonable, P2P lenders may offer a better rate than a private student loan.

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