The Federal Housing Finance Agency (FHFA) recently published the 2022-2024 Underserved Markets Plans for Fannie Mae and Freddie Mac under the Duty to Serve (DTS) Program. The DTS plans demonstrate a strengthened commitment to serving manufactured housing, affordable housing preservation and rural housing, according to a FHFA release.
FHFA said the targets and strategies in the plans build on lessons learned and progress made during the first four years of the DTS program.
“Providing sustainable liquidity for affordable housing preservation, rural housing and manufactured housing in a safe-and-sound manner is an integral part of the Enterprises’ responsibility to serve underserved markets,” FHFA Acting Director Sandra Thompson said in the release. “The additional activities and objectives to be implemented under these plans are important steps toward the Enterprises fulfilling their Duty to Serve mandate over the coming years.”
In May 2021, the Freddie Mac and Fannie Mae submitted proposed Duty to Serve plans that FHFA evaluated against agency priorities and the DTS regulation. FHFA determined none of the Enterprises’ initial plans met the DTS Non-Objection standard. After further revisions and evaluation, FHFA has determined the Enterprises’ latest proposed plans meet the Non-Objection standard.
The activities outlined by Freddie and Fannie to achieve their DTS plan objectives remain subject to FHFA review and approval to ensure compliance with the Enterprises’ Charter Acts, safety and soundness measures, and other conservatorship and regulatory requirements.
In 2016, FHFA issued a final rule that implemented the DTS provisions mandated by the Housing and Economic Recovery Act of 2008. The statute requires the Enterprises to serve three specified underserved markets—manufactured housing, affordable housing preservation and rural housing—by increasing the liquidity of mortgage financing for very low-, low-, and moderate-income families.
Under the DTS Program, the Enterprises prepare and submit to FHFA proposed three-year underserved markets plans that outline their objectives and activities to serve the manufactured housing, rural housing and affordable housing preservation markets. FHFA reviews and issues Non-Objections to those proposed plans based on the intended impact on each market.