Fannie Mae to Discontinue "Fannie Mae LIBOR" Indices
Today Fannie Mae announced that it will no longer post new values for its five Fannie Mae London Inter-Bank Offered Rate (LIBOR) indices, beginning the third quarter of 2007. The indices affected by this action are 1-, 3-, 6-, and 12-month LIBOR Rates and the 12-month monthly average. The final values for Fannie Mae LIBOR indices will be posted by June 28, 2007.
Fannie Mae will not accept delivery of any mortgage loans tied to any Fannie Mae LIBOR index that are originated after June 28, 2007.
Anyone using the Fannie Mae LIBOR index data to adjust mortgage loan interest rates should consult their own counsel regarding the appropriate replacement index for Fannie Mae LIBOR. Fannie Mae has recommended to its lender and servicer customers that subject to language in the related note, LIBOR values published in the Wall Street Journal are comparable replacement indices in most cases.
Fannie Mae will continue to make historic rates available on its Web site at www.fanniemae.com.
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