Bank Trade Groups Ask Fannie Mae to Abandon US Patent

by Patrick Lunsford, CollectionIndustry.com

Seven bank-industry trade groups representing thousands of financial institutions called on Fannie Mae (FNM) to abandon a U.S. patent it recently received that gives the company control over a computer program that matches potential homeowners with loans that are customized to meet their needs, according to a story by MarketWatch.

Fannie Mae cannot originate loans; it can only buy them on the secondary mortgage market. Still, the trade groups complained that by holding this patent, Fannie Mae could prevent other companies from developing similar technology and block innovation in the housing finance market.

“We request that Fannie Mae immediately take the necessary steps to renounce any rights to enforce the Patent and place it into the public domain, thereby enhancing the competitive nature of the mortgage markets, as well as other loan markets,” six trade groups, including the American Bankers Association and the Consumer Mortgage Coalition, wrote in a letter dated Friday.

A seventh trade group, the Mortgage Bankers Association, sent a separate letter to Fannie Mae last week asking the housing-finance giant to make the patent available to the public.