New housing goals for Fannie Mae and Freddie Mac for 2018 through 2020 were set by the Federal Housing Finance Agency (FHFA) this week.
The FHFA is required by the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 to set annual housing goals for mortgages purchased by the Fannie and Freddie. The housing goals apply to single-family mortgages in four categories — low-income home purchase, very low-income home, low-income areas home, and low-income refinance.
The single-family housing goal must exceed either the benchmark level set in advance by FHFA or the market level for that year. The market level is determined each year based on Home Mortgage Disclosure Act (HMDA) data for that year.
For multi-family mortgages, there are three categories — low-income, very low-income home, and small multi-family low income.
To meet a multifamily housing goal, Fannie and Freddie must purchase mortgages on multifamily properties (with five or more units) with rental units affordable to families in each category. There is also a sub-goal for properties with 5-50 units. FHFA measures these goals against benchmark levels set by FHFA.
Fannie and Freddie have the mission of supporting a stable and liquid national market for residential mortgage financing. FHFA establishes annual housing goals for Fannie and Freddie and assesses their performance.