WASHINGTON (12/16/15)--Fannie Mae and Freddie Mac will have to serve three specified underserved markets if the Federal Housing Finance Agency (FHFA) adopts a rule proposed Tuesday.
The proposal would implement Duty-to-Serve provisions of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992. That statute requires Fannie and Freddie to serve manufactured housing, affordable housing preservation and rural markets.
Under the proposed rule, both of the government-sponsored housing enterprises would have to adopt plans to improve the distribution and availability of mortgage financing in a safe and sound manner for residential properties that serve very low-, low- and moderate-income families in the three specified underserved markets.
The proposed rule would provide Duty-to-Serve credit for eligible Fannie and Freddie activities that facilitate a secondary market for mortgages on residential properties in the specified underserved markets.
It would also establish a method for evaluating and rating Fannie’s and Freddie’s performance each year, on which FHFA would report annually to the U.S. Congress.
Both Fannie and Freddie would be required to submit a plan covering a three-year period describing how it would meet its Duty-to-Serve obligations.
The FHFA will accept public comments for 90 days after the proposal is published in the Federal Register, which may occur within the next week.