Small Lenders Leverage Program to Compete with Larger Firms

""The Mortgage Partnership Finance (MPF) Program,"":http://www.fhlbmpf.com/ originated in 1997 to assist small financial institutions in selling fixed-rate conforming loans to the secondary market, has experienced rapid growth over the last year.

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Both the number of financial institutions participating in the program and the number of loans funded through the program grew in 2012, according to a release from MPF.

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The roster of lenders relying on the MPF Program grew 15 percent in 2012.

In loan volume, the program financed $14.33 billion in 2012, up from $6.99 billion in 2011.

""The MPF Program lets community lenders offer their customers home loans at a competitive price, which means borrowers can continue to work with their local lending institutions they know and trust,"" said Eric Schambow, SVP and director of MPF, ""and Federal Home Loan Bank (FHLB) Members can take advantage of their existing relationship with their FHLP.""

The program allows smaller, community banks to compete with larger lending institutions in the mortgage market.

Participating lenders also benefit from additional training and support, including access to Fannie Mae's Desktop Underwriter to help with credit risk assessment.

MPF also offers MPF Xtra, which sells loans directly to Fannie Mae. Use of this product more than doubled last year. In 2012, the product served more than $6.94 billion in loans, up from $2.81 billion in 2011.