FHFA Proposes Changes to FHLBank Housing Goals

The Federal Housing Finance Agency (FHFA) has requested input on is seeking comments on proposed amendments to the existing regulation for the Federal Home Loan Bank (FHLBank) Housing Goals.

 

According to the FHFA, the proposed changes include creating a single prospective mortgage purchase housing goal as a share of each FHLBank's total Acquired Member Asset (AMA) purchases, establishing a new small member participation housing goal for participation by small institutions, and the elimination of the volume threshold in order to allow FHLBanks to propose different goals levels for mortgage purchases and small member participation. The changes would also simplify and expand the eligibility criteria to enable federally backed loans to count for goals purposes.

 

The proposed rule would override a December 2010 final that subjects a FHLBank to the housing goals if in a given year a FHLBank's AMA purchases exceed a volume threshold of $2.5 billion. The FHLBanks purchase mortgages through the AMA program, and participation in the program is voluntary.

 

“To be successful housing goals should lead the FHLBanks to make affordable housing part of their business plans for AMA," said FHFA Director Melvin L. Watt. “The overall approach of the proposed amendments will encourage FHLBanks and their members to build on the strengths of the AMA program to assist targeted borrower groups in a safe and sustainable manner."

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