April 19, 2018

FHFA Seeks to Expand Mortgage Access

-A A +A

FHFA Seeks to Expand Mortgage Access

The Federal Housing Finance Agency announced that it wants housing finance giants Fannie Mae and Freddie Mac to provide greater support to low-income mortgage borrowers and refinancers.

FHFA, which is the regulator for Fannie Mae and Freddie Mac, outlined goals for 2015-2017 aimed at advancing that goal. It wants to ensure that low-income families account for 23 percent of the GSE’s purchases of single-family home mortgages. Also, the agency seeks to ensure that the firms raise the share of their purchases that back mortgages in low-income areas with large minority populations. FHFA has charged the firms with raising the share of their mortgage refinance operations that target low-income Americans, Reuters reports.

Find out why first-time and low-income mortgage borrowers may have an easier time qualifying for a Federal Housing Administration loan.

More specifically, FHFA has charged Freddie Mac with gradually expanding the number of loans it backs for low-income multifamily buildings, such as apartment buildings. It wants Freddie Mac to expand such loans to 230,000 by 2017; currently it’s target for this year is 200,000.

Some lawmakers may view FHFA’s move as controversial, with critics saying that boosting the support of mortgage access for low-income borrowers is what led to the housing bubble that burst in 2006, Reuters reports.

Source: “U.S. Housing Regulator Seeks More Support for Poor Borrowers,” Reuters (Aug. 29, 2014)