Recently, the Federal Housing Finance Agency (FHFA) announced Fannie Mae and Freddie Mac (the Enterprises) will submit Equitable Housing Finance Plans to FHFA by the end of 2021, according to a release by Freddie Mac. The Enterprises will update these plans annually.
The plans will identify and address barriers to sustainable housing opportunities, including the Enterprises’ goals and action plans to advance equity in housing finance for the next three years. FHFA also will require the Enterprises to submit annual progress reports on the actions undertaken during the prior year to implement their plans.
“For generations, discriminatory practices like redlining have prevented communities of color from building wealth through homeownership,” FHFA Acting Director Sandra Thompson said in the release. “By identifying the barriers to equitable and sustainable housing finance opportunities and setting goals for addressing those barriers, the Enterprises, consistent with safety and soundness, can responsibly reduce the racial and ethnic disparities in homeownership and wealth that still exist today.”
Under the recently signed Memorandum of Understanding between FHFA and HUD regarding fair housing and fair lending coordination, HUD provided insight and expertise to FHFA regarding this equitable housing finance initiative.
“This is a major step in bringing more equity to the housing finance industry,” HUD Secretary Marcia Fudge said. “HUD’s recent collaborations with FHFA are crucial actions that will advance fair housing and fair lending for all Americans and expand access to opportunities for homeownership and the generational wealth building that can come from it. HUD is pleased to work alongside FHFA and others on a comprehensive approach to building a more equitable housing finance system.”
FHFA said it has a statutory duty to ensure the Enterprises operate in a manner consistent with safety and soundness and the public interest. FHFA is issuing a Request for Input that seeks public input until Oct. 25, to aid the Enterprises in preparing their first plans and to aid FHFA in overseeing the plans.
FHFA hosted a public listening session on Sept. 28 to allow for additional public input.