Housing prices in convenient communities -- those with many job, shopping, recreation
and other destinations nearby -- are often higher than in surrounding less convenient
sprawling areas. However, families living in these convenient communities generally save
auto expenses from owning fewer cars and driving less. These savings can equal $6000 or
more annually for the average family. But the initial price of this housing often prevents
their qualifying for a mortgage.
Now there IS an anti-sprawl tool out there that addresses these high housing prices.
Location Efficient Mortgage services allows a mortgage lender to recognize the
transportation-related cost savings of living in convenient, high-density communities with
transit access by adding the savings onto the qualifying income of the consumer. For
instance, a household making $50,000 may qualify for a 30-year loan of $163,000 at 8%
using conventional underwriting guidelines; using Location Efficient Mortgage services
that household could qualify for a $213,000 mortgage -- depending on how "location
efficient" their desired piece of property or condominium is. The level of the
savings results from extensive studies on auto ownership, driving levels, transit access
and other variables which identify how much households are spending on their
Location Efficient Mortgage services are available in the cities of Chicago and
Seattle; Los Angeles County; and the nine-county San Francisco Bay Area. The mortgage
services are currently part of an underwriting experiment sponsored by Fannie Mae, the
nation's largest source of mortgage funds. We hope that demonstrated success of the
mortgage will result in even more cities and regions where these services will be
available. Call 1-800-7FANNIE for more information and a list of available lenders in your
area. Also check out www.locationefficiency.com
to see how much of a loan you can qualify for in Chicago, Seattle and L.A County (San
Francisco Bay Area site is pending).
LOCATION EFFICIENT MORTGAGE services is a certification mark owned by the Institute
for Location Efficiency. Unauthorized use of this mark is prohibited.
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