Reforms to Freddie Mac and Fannie Mae Must Preserve Significant Expansion of National Housing Trust Fund
Congress is beginning to turn its attention to Freddie Mac and Fannie Mae housing finance reform legislation. And the National Low Income Housing Coalition (NLIHC) has joined a coalition of national civil rights and fair housing organizations in support of comprehensive legislation that promotes access and affordability in the housing market.
This new coalition agrees that any reforms of Freddie Mac and Fannie Mae mus:
preserve and enhance fair housing and anti-discrimination protections;
provide broad access for borrowers, institutions, and regions;
protect taxpayers from future bailouts; and
preserve the entities’ affordable housing mission and the availability of inclusive loan products and services, including a significant expansion of the national Housing Trust Fund.
Legislation has not been formally introduced. But a draft bill crafted by Senators Bob Corker (R-TN) and Mark Warner (D-VA) would have capped funding for the national Housing Trust Fund to as low as $440 million – far less than the $3.5 billion proposed in legislation approved by the Senate Banking Committee in 2014.
The draft bill would divert funding away from extremely low income households through the Housing Trust Fund into a Market Access Fund to support home-ownership activities for households with relatively higher incomes.
The draft bill would also eliminate Fannie Mae and Freddie Mac’s affordable housing goals and Duty to Serve obligations. If Senators Corker and Warner introduce legislation that is similar to the draft version, NLIHC will strongly oppose the bill.
The Housing Trust Fund is one of Monarch Housing Associate’s policy priorities for creating homes families can afford and ending homelessness in New Jersey. We aim to protect and fund the Housing Trust Fund by opposing any legislative or administrative attempts to prevent Fannie Mae and Freddie Mac from providing funding for the Housing Trust Fund or to prevent its future implementation.
Monarch Housing supports increasing funding for the Housing Trust Fund through housing finance reform, the budget process, investments in infrastructure and other legislative opportunities.
The national Housing Trust Fund (HTF) is the first new housing resource since 1974 targeted to building, rehabilitating, preserving, and operating rental housing for extremely low income people.
The national Housing Trust Fund was created through the passage of the Housing and Economic Recovery Act of 2008.
In 2016, the first $174 million in HTF dollars were allocated to states. In 2017, $219 million is available. These initial allocations are important steps, but far more resources are needed.