Webster Bank, National Association, a subsidiary of Webster Financial Corporation (NYSE: WBS), Webster Bank, a wholly-owned subsidiary of Webster Financial Corporation (NYSE: WBS), has been selected by Connecticut Housing Finance Authority (CHFA) to be a lender in a new mortgage refinancing assistance program to help low- and moderate-income borrowers who took out subprime, adjustable-rate loans to purchase their first home.
Announced in November by Gov. M. Jodi Rell, the Connecticut Fair Alternative Mortgage Lending Initiative & Education Services Program (CT FAMLIES) is a new $50 million project administered by the CHFA designed to address the subprime mortgage crisis in Connecticut.
Gov. Rell convened a Subprime Mortgage Task Force in April, in part, to determine the scope of the problem in the state. That task force has estimated there are about 71,000 active subprime mortgages in Connecticut. About 21,000 of those are adjustable-rate mortgages, which are slated to reset between October 2007 and December 2009.
CT FAMLIES was created to enable first-time homebuyers to refinance their adjustable-rate mortgages into 30-year, fixed rate amortizing loans at .25% above CHFA's regular rate, which is typically below market rates.
In order to participate in CT FAMLIES, borrowers must meet several eligibility requirements that include income limits, mortgage payment history and property type.
"Most adjustable-rate subprime mortgages carried low initial rates so many of the borrowers may not have fully understood that their monthly payments could rise sharply after the first two or three years," said Michael Sheahan, Webster's Director of Mortgage Banking. "Webster is proud to have been selected to participate in this important new program and demonstrate our continued commitment to meeting the needs of the communities we serve."
Webster Financial Corporation is the holding company for Webster Bank, National Association and Webster Insurance. With $16.8 billion in assets, Webster provides business and consumer banking, mortgage, insurance, financial planning, trust and investment services through 179 banking offices, 339 ATMs, telephone banking and the Internet. Webster Bank owns the asset-based lending firm Webster Business Credit Corporation, the insurance premium finance company Budget Installment Corp., Center Capital Corporation, an equipment finance company headquartered in Farmington, Connecticut and provides health savings account trustee and administrative services through HSA Bank, Member FDIC and equal housing lender. -- Webster Bank
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