WASHINGTON — Fannie Mae's low-down-payment product has fallen far short of expectations, the company acknowledged Friday.

The government-sponsored enterprise was enthusiastic about launching the 97% loan-to-value product when it announced it in December 2014. But it has yet to become a sizable part of Fannie's business.

"To date, we have had about 24,000 loans delivered to us from about 700 different lenders," Timothy Mayopoulos, Fannie's president and chief executive, said in a conference call Friday morning. "But obviously with only 24,000 loans, which is about 1% of our total acquisitions over that time period, it is still a modest portion of our total credit book."

Federal Housing Finance Agency Director Mel Watt announced the initiative at the 2014 Mortgage Bankers Association conference, saying it would "increase access for creditworthy but lower-wealth borrowers."

But Fannie and Freddie Mac ran into competition from the traditional 3.5%-down-payment loans insured by the Federal Housing Administration. In a surprise move, the FHA reduced its 1.35-basis-point annual premium to 85-bps in January 2015.

The FHA's move to reduce its premiums "cut into the total amount of deliveries that came to us," Mayopoulos said on Friday.

Fannie still likes the quality of the 3%-down-payment loans it is receiving from lenders. The applications are submitted through Desktop Underwriter. "They are fully and properly documented," Mayopoulos said.

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