What is ‘Tandem Plan’
In the United States, the government has supported a mortgage purchase scheme. Tandem loans are financial support provided to builders and developers of non-profit public housing projects to help them meet their financial obligations. When mortgages are purchased at a discount from the market price, the Government National Mortgage Association (GNMA / Ginnie Mae) sells them via the Federal National Mortgage Association (FNMA / Fannie Mae) and the Federal Home Loan Mortgage Corporation (FHLMC / Freddie Mac).
Explaining ‘Tandem Plan’
Under the Tandem Plan, the General National Mortgage Association (GNMA) pays the difference between the purchase and selling prices of the mortgages that it purchases. This sort of arrangement enables property purchasers to acquire low-interest loans, which are typically available to individuals who would not otherwise be able to afford them.
Tandem Plan FAQ
What is the tandem plan in real estate?
Low-interest mortgages are available via a government program for qualifying purchasers with limited financial resources. GNMA subsidizes the low-income house buyer while incurring a loss on the sale as a result of this move.
- The Impact of the GNMA Tandem Plans: Comment –
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