Fannie Mae this week announced the rollout of a new initiative in North Carolina and Texas that will lower financing costs to property owners who accept federal housing choice vouchers.
The voucher program through the U.S. Department of Housing and Urban Development allows disadvantaged groups to lease safe, decent and affordable privately owned housing. These groups include seniors, underserved minority populations, people with disabilities and very low-income households (those that earn less 50% of the area median income).
The government-sponsored enterprise (GSE) hopes to drive greater acceptance of the vouchers in the multifamily housing market. Many voucher holders, especially people of color, are unable to use the vouchers before they expire, Fannie Mae CEO Hugh R. Frater said in a news release.
“As we fulfill our mission, we are working with the housing community to expand access to affordable housing for those who need it most,” Frater said.
Fannie’s pilot program is expected to run for the next year in North Carolina and Texas, which were chosen because they are states where HUD voucher acceptance is not required. Additionally, each state has a plentiful supply of affordable multifamily units. The initiative applies to purchase and refinance loans on existing properties with five or more units. The GSE will incorporate feedback from property owners and other market participants before expanding the program to other states.
The voucher-expansion effort is being conducted through Fannie Mae Multifamily’s Delegated Underwriting and Servicing platform. For property owners, the benefits of voucher acceptance include guaranteed and competitive rental income, free inspections and lower mortgage pricing.