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Affordable Housing Program Amendments: Federal Home Loan Bank Mortgage Refinancing Authority

Open Date:
Open for comment 8/4/2009
Deadline:
All comments are due by 10/5/2009
Type:
Interim Final Rule
Number:
RIN-2590-AA04
Group:
Supervision and Regulation; Federal Home Loan Banks; Homeowners-Homebuyers; Mortgage Assistance
FHLBanks
Document Number:
E9-18484
CFR:
12 CFR 1291
CFR Description:
 
Federal Register Publish Date:
8/4/2009
Federal Register Citation:
View Document:
 
Contact Information:

​Nelson Hernandez, Senior Associate Director, Housing Mission and Goals, (202) 408-2819, Nelson.Hernandez@fhfa.gov; Charles E. McLean, Jr., Acting Manager, Housing Mission and Goals, (202) 408-2537, Charles.McLean@fhfa.gov; or Melissa L. Allen, Senior Policy Analyst, (202) 408-2524, Melissa.Allen@fhfa.gov, Federal Housing Finance Agency, 1625 Eye Street, NW., Washington, DC 20006; or Sharon B. Like, Associate General Counsel, (202) 414-8950, Sharon.Like@fhfa.gov, Federal Housing Finance Agency, 1700 G Street, NW., Washington, DC 20552.  If you are deaf, hard of hearing, or have a speech disability, please dial 7-1-1 to access telecommunications relay services. Additionally, the TDD 1-(800) number referenced in Rulemaking documents attached to this page is obsolete and the 7-1-1 number should be used.

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​SUMMARY: Section 1218 of the Housing and Economic Recovery Act of 2008 (HERA) requires the Federal Housing Finance Agency (FHFA) to permit the Federal Home Loan Banks (Banks) until July 30, 2010, to use Affordable Housing Program (AHP) homeownership set-aside funds to refinance low- or moderate-income households’ mortgage loans. On October 17, 2008, FHFA amended its AHP regulation to authorize the Banks to provide AHP direct subsidies under their homeownership set-aside programs to low- or moderate-income households who qualify for refinancing assistance under the Hope for Homeowners Program established by the Federal Housing Administration (FHA) under Title IV of HERA. Based on the comments received on the amendments and continuing adverse conditions of the mortgage market, FHFA has determined that in order for the AHP set-aside refinancing program to be implemented successfully for the benefit of the intended households, the scope of the program authority should be broadened and the Banks should have greater flexibility in implementing the program. Accordingly, FHFA is issuing and seeking comment on an interim final rule that authorizes the Banks to provide AHP subsidy through their members to assist in the refinancing of eligible households’ mortgages under eligible Federal, State and local programs for targeted refinancing in addition to the Hope for Homeowners Program. These programs would include the Administration’s Making Home Affordable Refinancing program. The interim final rule permits the Banks to provide AHP direct subsidy to members and to use the subsidy for principal reduction and for loan closing costs, and requires that households obtain counseling for qualification for refinancing and foreclosure mitigation.

In addition, the interim final rule enhances the ability of the Banks to respond to the mortgage crisis by providing greater flexibility to accelerate their future annual statutory AHP contributions for use in their AHP homeownership set-aside programs in the current year. The interim final rule also permits the Banks to adopt multiple housing needs under their Second District Priority scoring criterion under the AHP competitive application program.

DATES: The interim final rule is effective on August 4, 2009. FHFA will accept written comments on the interim final rule on or before October 5, 2009.


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