FHFA Extends Deadline for ‘Duty to Serve’ Chattel Loans Comments
The Federal Housing Finance Agency extended a deadline for stakeholder input on potential manufactured home chattel loans pilot initiatives for Fannie Mae and Freddie Mac as part of the Duty to Serve underserved markets until Mar. 21.
This extension is related to a final rule issued by FHFA on Dec. 13 (https://www.fhfa.gov/Media/PublicAffairs/Pages/FHFA-Issues-Final-Rule-on-Fannie-Mae-and-Freddie-Mac-Duty-to-Serve-Underserved-Markets.aspx) to implement the Duty to Serve provisions mandated by the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by the Housing and Economic Recovery Act of 2008.
The statute requires Fannie Mae and Freddie to serve three specified underserved markets–manufactured housing, affordable housing preservation and rural housing–by improving distribution and availability of mortgage financing in a safe and sound manner for residential properties that serve very low-, low- and moderate-income families in these markets. The rule requires each Enterprise to develop an Underserved Markets Plan to fulfill this mandate.
The final rule established as a Regulatory Activity Enterprise activities designed to facilitate a secondary market for loans on manufactured homes titled as personal property, also referred to as chattel, through pilot initiatives undertaken in a safe and sound manner.
FHFA issued the Request for Input (https://www.fhfa.gov/Media/PublicAffairs/PublicAffairsDocuments/Chattel-Pilot-RFI.pdf) on what an Enterprise should include in a chattel pilot initiative, if an Enterprise decides to pursue a pilot initiative.
The Mortgage Bankers Association supports these initiatives. In a March 2016 letter (http://mba-pc.informz.net/mba-pc/data/images/FINAL MBA Comments on FHFA Duty to Serve – 3-17-16.pdf), MBA said the GSEs’ role as secondary market investors can be amplified through explicit encouragement of the GSEs’ ability to leverage their secondary market role in assessment of new product opportunities.
In the letter, MBA recommended FHFA direct the GSEs to incorporate products and programs previously or currently under development, maintain flexibility in grading the GSEs progress and ensure plans are drafted in a way that can be easily and accurately communicated through the GSEs’ Guide framework. “MBA believes successful implementation will provide an opportunity to demonstrate how the GSEs can serve underserved markets through viable and measurable activities,” MBA said.
