GSEs Developing Plans To Further Assist Underserved Markets

Posted by Patrick Barnard on December 19, 2016 No Comments
Categories : Residential Mortgage

The Federal Housing Finance Agency (FHFA) has directed government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac to come up with specific plans for how they will address the housing needs of very low-income, low-income and moderate-income families in the manufactured housing, affordable housing preservation and rural housing markets.

Last week, the FHFA issued a final rule to implement the Duty to Serve provisions mandated by the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by the Housing and Economic Recovery Act of 2008.

The statute requires Fannie Mae and Freddie Mac to serve three specified underserved markets – manufactured housing, affordable housing preservation and rural housing – by improving the distribution and availability of mortgage financing.

The final rule does not mandate any particular activities but requires the GSEs to consider ways to better serve families in the three underserved markets. Each must submit a three-year plan to do so – and the plans will become effective January 2018.

“With this final rule, which reflects extensive input from a wide variety of stakeholders, FHFA is fulfilling its statutory requirement to implement the Duty to Serve provisions in the Housing and Economic Recovery Act,” says Mel Watt, director of the FHFA, in a release. “We look forward to working with Fannie Mae and Freddie Mac to help meet the critical housing needs for very low-, low- and moderate-income American families around the country in the manufactured housing, affordable housing preservation and rural housing markets. As we do so, we, of course, will evaluate each enterprise proposal to ensure that it will not compromise safety and soundness.”

The FHFA is now gathering feedback from industry stakeholders on this effort via a dedicated webpage, FHFA.gov/DTS.

Further development of the programs is expected to occur in 2017.

“Fannie Mae embraces the FHFA rule to implement the new Duty to Serve provisions, which address the needs of American families in search of solutions to their housing challenges,” says Timothy J. Mayopoulos, president and CEO of Fannie Mae, in a release. “Fannie Mae is committed to working with our partners to help families in underserved markets across the U.S.”

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