NLIHC signed on to a letter originated by the Center for American Progress to Federal Housing Finance Agency (FHFA) Director Mel Watt urging him to set strong affordable housing goals for Fannie Mae and Freddie Mac (“the Enterprises”) and to enable them “to reach their goals through innovative and proactive means.” The May 23 letter also encourages Mr. Watt to lift the suspension on the obligation of Fannie Mae and Freddie Mac to make payments to capitalize the National Housing Trust Fund and the Capital Magnet Fund.
FHFA is about to begin the rulemaking process to set affordable housing goals for 2015. Affordable housing goals set benchmarks for the percentage of the Enterprises’ single family and multifamily purchases that serve low income communities.
The signatories note, “in its two most recent housing goal rulemakings, FHFA has set the goals primarily based on its estimations of the Enterprises future share of underserved markets and its desire to promote long-term profitability of the Enterprises. While both of these are important, FHFA is by law required to consider other factors when setting the goals, including national housing needs and the ability of the Enterprises to lead the industry in making mortgage credit available. We recommend you consider these factors in the upcoming rulemaking.”
The letter recommends that Director Watt increase the multifamily housing goals, “given the extent of the affordability crisis in the rental housing space, and given that in almost all cases, the Enterprises exceeded their multifamily housing goals between 2010 and 2013, we think further strengthening those goals will be a critical tool to encourage the Enterprises to help bolster the rental market and meet unmet housing needs.”
“Along with changing the approach to the housing goals, we encourage FHFA to work with HUD to ensure that the Enterprises are meeting their obligation to affirmatively further fair housing. FHFA should also finalize a strong duty to serve rule and support affordable housing by lifting the ban on Enterprise contributions to the Housing Trust Fund and Capital Magnet Fund,” wrote the signatories.
NLIHC and others have been urging Mr. Watt to allow the NHTF contributions to begin immediately and make them retroactive to the first quarter of 2012, the point at which the Enterprises returned to profitability (see Memo, 1/24). Mr. Watt reports that he is examining the request closely and will make a determination based on his analysis of what the stature requires. His predecessor, Acting FHFA Director Ed DeMarco, declined to lift the suspension.
Read the letter at: http://bit.ly/1gxf1Vh