Freddie Mac is speeding up the delivery of new subprime products that might offer more stable refinancing alternatives to subprime borrowers by midsummer."These products will include 30-year and possibly 40-year fixed-rate mortgages and adjustable-rate mortgages with reduced margins and longer fixed-rate periods," Freddie Mac chairman and chief executive Richard Syron told a House Financial Services subcommittee. "We expect to offer ARMs of five years or more with margins at adjustment that are as much as 200 basis points below the current step-up." Originally, Freddie Mac was not expected to introduce the subprime products until September. Mr. Syron also said modifications to Freddie's "Home Possible" products are in the works to provide subprime borrowers with additional refinancing options. Some underwriting characteristics of the HomePossible products overlap with those in the subprime market, "providing viable upstreaming opportunities for some segment of subprime borrowers," he said.
