Metro News Release

For immediate release: July 23, 2003

Smart Commute initiative offers commuters easy way to purchase a home near a bus stop or Metrorail station and take advantage of public transit

It now pays to live near a regional bus stop or rail station and take public transit to work.

A new Smart Commute Initiative, unveiled today by Fannie Mae, allows persons to purchase a home in the Washington Metropolitan area near public transit, use it as their means of commuting to and from work, and allows them to take into account the money they save on commuting to receive a larger mortgage.

"The Smart Commute Initiative expands affordable housing choices and reduces traffic congestion by linking housing and public transportation," said Metro Board Member Kate Hanley. "It recognizes that homeowners who spend less on commuting can put the potential savings toward the purchase of a home."

If someone chooses a home near rail or bus service, the initiative allows lenders to add a portion of the potential commuting savings to their qualifying income required for the loan-thus increasing their home-buying power by at least $10,000. Locally, the Fannie Mae-sponsored mortgage program includes lenders Chevy Chase and SunTrust.

"Smart Commute rewards people for choosing a home located one-quarter mile from a public transit bus stop or one-half mile from a rail station. It promotes Smart Growth and builds transit ridership," said Metro Board Member Christopher Zimmerman. "Plus it has the added benefit of positively impacting the local environment by lessening the impact of vehicle emissions."

Borrowers will receive a 50 percent discount for six months on Metrobus or Metrorail. The discounts will be distributed via mail through the Arlington County Commuter Store regardless of the jurisdiction in which they purchase the house.

Reduced transit fare will also be available for a limited time from other participating transit agencies that are participating in the program, including ART buses (Arlington), CUE buses (Fairfax City), DASH buses (Alexandria), Virginia Rail Express, Fairfax Connector, Flexcar, and OmniRide (Prince William). The program is also endorsed by the Federal Transit Administration, the Metropolitan Washington Council of Governments, the Washington Board of Trade, and the American Public Transportation Association. The local transit agencies will provide a mix of free or discounted transit service for the new homeowners and free advertising for the program.

The Smart Commute Initiative, which has no income restriction, offers home buyers seeking a mortgage of less than $322,000, several benefits, including:

  • a down payment of only 3 percent of the purchase price of a home; and
  • for loan qualification purposes, an increase in income by the estimated amount of transportation savings gained by using public transit-$200 per month in income for one wage-earner households, and $250 per month in income for two wage-earner households-equating to at least $10,000 more in their mortgage.

It is estimated that up to 10 borrowers per month will take advantage of the mortgage program and that the discounted transit service will cost Metro approximately $50,000 a year for two years (approximately 120 mortgages).

The Smart Commute program is planned in 11 other regions of the country including Baltimore, Philadelphia, Atlanta, El Paso, Louisville (KY), Minneapolis, Pittsburgh, Salt Lake City, State College (PA), Delaware, and New Jersey.

The initiative is offered through a partnership that includes Chevy Chase Bank/B.F. Saul Mortgage; SunTrust Mortgage, Inc.; WMATA; ART; DASH; VRE; Fairfax Connector; CUE; Flexcar: Ride On; PRTC; the governments of the District of Columbia, Fairfax Arlington, Prince William, Montgomery, and Prince George’s Counties; the cities of Alexandria, Falls Church, Fairfax, Manassas, Manassas Park; the Town of Herndon; COG; BOT; the National Capital Planning Commission; APTA; the Northern Virginia Association of Realtors; Prince William Association of Realtors; the Greater Capital Area Association of Realtors; Washington DC Association of Realtors; Northern Virginia Building Industry Association; District of Columbia Building Industry Association; and the Maryland National Capital Building Industry Association.

For more information, see the Smart Commute page on the Metropolitan Washington Council of Governments Web site.

News release issued on July 23, 2003.