Fannie Mae to Reduce Mortgage Insurance

In a move designed to help home buyers with good credit but small savings, Fannie Mae said it will reduce the amount of mortgage insurance required for borrowers who make down payments of less than 20% of a home’s purchase price. Franklin D. Raines, chairman and chief executive of the Washington-based company, made the announcement at the National Assn. of Home Builders convention in Dallas. The change, which takes effect in early March, reduces the amount of private mortgage insurance required to protect lenders against default.