Fannie, Freddie release updates to equitable housing plans

Expansions to downpayment-assistance programs, rent-payment reporting slated for this year

Fannie Mae and Freddie Mac have released this year’s updates to their Equitable Housing Finance Plans, revealing expansions to various programs as well as kickoffs to new initiatives aimed at viable access to affordable homeownership and rental housing.

The updates build on the inaugural plans released last year to identify and address barriers to sustainable housing opportunities, especially for underserved communities. The plans are part of the government-sponsored enterprises’ goals to advance equity in housing finance for the next three years and are set to receive annual updates during that time frame. Adjustments to the plans were based on research and findings over the course of the previous year.

“As we celebrate Fair Housing Month and the 55th anniversary of the Fair Housing Act, we are reminded that every step taken toward bringing more equity into the housing finance system is a step in the right direction,” said Sandra L. Thompson, director of the Federal Housing Finance Administration (FHFA). “In 2022, the enterprises helped more than 834,000 households through various actions outlined in their Equitable Housing Finance Plans.”

Fannie’s plan has a stated focus on two hurdles faced by many Black and Latino homeowners and renters: to reduce upfront rental and homeownership costs related to insufficient credit while improving the chances for success by focusing on education.

As such, Fannie’s plan for 2023 includes 25 separate actions, including the development and expansion of downpayment-assistance programs, special purpose credit programs (SPCPs) and innovations in mortgage underwriting, all to help first-time homebuyers. The plan also includes the support of five organizations that earned contracts last year through Fannie’s Sustainable Communities Innovation Challenge to increase affordable housing supply. Also in the plan is the growth of consumer counseling programs to empower more people to achieve housing stability in the long term.

“Since the launch of our plan in 2022, we have made considerable progress in identifying meaningful ways to address historical challenges faced by underserved communities, particularly for Black and Latino people,” said Katrina Jones, Fannie Mae’s vice president of racial equity strategy and impact. “When you add the present-day challenges of inadequate affordable housing supply and high housing costs, overcoming barriers to housing can seem harder than ever. But we are committed to making a fundamentally fairer and more equitable future for housing.”

Freddie’s plan update outlines a similar approach built around purchasing more loans via SPCPs while supporting the construction and rehabilitation of affordable and workforce housing. Freddie’s plan also makes special mention of the enrollment of renter households into the agency’s credit-building initiative. More than 184,000 renter households enrolled in Freddie’s program last year, with more than 27,000 of them establishing credit scores for the first time. The company will expand the initiative to more credit-reporting vendors this year.

“We were able to make measurable headway on our equitable housing goals in year one by working closely with FHFA and other industry participants,” said Michael Hutchins, president of Freddie Mac. “Our 2023 plan incorporates new thinking and lessons learned to ensure we are as effective and impactful as possible.”


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