Wednesday, November 1, 2017

Fannie Mae misses two affordable housing goals in 2016, FHFA reports

By J. Preston Carter, J.D., LL.M.

The Federal Housing Finance Agency, in its Annual Housing Report, has preliminarily determined that Fannie Mae failed to meet the very low-income home purchase goal and the low-income refinance goal for 2016. However, Fannie Mae did achieve the single-family low-income home purchase goal and the low-income areas home purchase goal. The FHFA has preliminarily determined that Freddie Mac achieved all of the multifamily goals for 2016.

The report describes the affordable housing activities of the Enterprises during 2016 and meets the reporting requirements of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended. Fannie Mae’s total business volume in 2016 was $637.4 billion and, as a result, the total affordable housing allocation transferred was $268 million. Freddie Mac’s total business volume in 2016 was $445.7 billion and the total affordable housing allocation transferred was $187.1 million.

Besides announcing the FHFA’s preliminary review of the Enterprises’ 2016 housing goals performance, the report also includes information about the distribution of single-family loans by race/ethnicity, gender, and census tract median income. In addition, the report includes a breakdown of the single-family mortgage product-types purchased by each Enterprise, as well as information on mortgage payment type (e.g., fixed-rate or adjustable-rate mortgage), loan-to-value ratios, and credit scores for 2016.

The report describes the status of several other activities related to affordable housing, including the FHFA’s Duty to Serve rule. The report also describes the affordable housing allocations made by each Enterprise, as well as the FHFA’s efforts to survey the mortgage markets and release loan-level data submitted by the Enterprises to the public. Finally, the report discusses subprime, nontraditional, and higher-priced mortgage loans.

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