Newsroom

The Federal Housing Finance Agency (FHFA) in its final rule decided to not adopt an outcome-based framework for the Federal Home Loan Banks' (FHLBs) affordable housing program (AHP), heeding a number of NAFCU concerns. NAFCU, commenting on the agency's proposed AHP changes, was concerned such a framework would limit the program's flexibility and prevent FHLBs from meeting the needs of their communities.

The FHFA issued the final rule to amend the AHP Tuesday.

In addition, the final rule retains the current retention agreements requirement for owner-occupied, AHP-assisted units and allows the FHLBs to decide on a case-by-case basis whether to use a retention agreement, but eliminates it for instances where a household uses the AHP subsidy solely for rehabilitation. NAFCU had asked the FHFA to not eliminate the requirement and to provide the FHLBs more discretion to use it.

NAFCU also argued that the proposal's provision for the mandatory funding of alternates would reduce the FHLBs' flexibility to reallocate funds as most appropriate, which compromises the effectiveness of the AHP. The FHFA took these concerns into account and in the final rule makes the approval of alternates discretionary rather than mandatory.

NAFCU will continue to work with the FHFA to ensure credit unions' concerns are heard and addressed as the agency makes progress on various housing finance reform efforts.