The Federal Housing Finance Agency (FHFA) has made updates to government-sponsored enterprises Fannie Mae and Freddie Mac’s Equitable Housing Finance Plans for 2023, including recommendations to better serve Latino renters and homeowners.
The updates build upon the inaugural plans announced last year and make adjustments based on initial research and findings. The Equitable Housing Finance Plans are designed to complement the initiatives outlined in FHFA’s Strategic Plan: Fiscal Years 2022–2026 that promote the enterprises’ safety and soundness and foster housing finance markets that provide equitable access.
“As we celebrate Fair Housing Month and the 55th anniversary of the Fair Housing Act, we are reminded that every step taken towards bringing more equity into the housing finance system is a step in the right direction,” says FHFA Director Sandra L. Thompson. “In 2022, the enterprises helped more than 834,000 households through various actions outlined in the Equitable Housing Finance Plans.”
Last year, the GSEs released plans to identify and address barriers to sustainable housing opportunities, including the enterprises’ goals and actions to advance equity in housing finance for the next three years.
The racial homeownership gap persists, with homeownership rates for households of color more than 24 percentage points lower than the rate among white households.
Updates to the enterprises’ 2022-2024 plans include:
- Inclusion of the Latino housing journey and actions to remove barriers experienced by Latino renters and homeowners in Fannie Mae’s plan.
- Enhanced focus on ensuring existing borrowers receive fair loss mitigation support and outcomes through monitoring and developing strategies to close any gaps.
- Provision of financial capabilities coaching to build credit and savings.
- Support for locally-owned modular construction facilities in communities of color.
- Increases to the reach of enterprise special purpose credit programs to support homeownership attainment and housing sustainability in underserved communities.
In addition, the GSEs released performance reports that outlined their progress under their Equitable Housing Finance Plans during 2022 and actions they are taking to advance equity in their automated underwriting systems, such as the inclusion of rental payments and cash flow underwriting and the use of advanced statistical techniques to improve model fairness.
Photo by Maximillian Conacher on Unsplash