The national Housing Trust Fund and Capital Magnet Fund will receive approximately $545 million from Fannie Mae and Freddie Mac, announced the Federal Housing Finance Agency (FHFA).
“The need for more affordable housing has never been greater,” said Sandra L. Thompson, FHFA director. “A portion of every loan purchased by the enterprises is allocated to the Housing Trust Fund and the Capital Magnet Fund, which provide resources that increase the production and preservation of affordable housing options in our communities.”
The Housing Trust Fund, overseen by the Department of Housing and Urban Development, will receive $354 million. The Housing Trust Fund allocates funding annually to states and state-designated entities for the production or preservation of affordable housing through the acquisition, new construction, reconstruction, and/or rehabilitation of non-luxury housing.
The Capital Magnet Fund, overseen by the Treasury Department, will receive $191 million. The Capital Magnet Fund competitively awards money to finance affordable housing activities, as well as related economic development activities and community service facilities.
By law, amounts allocated to these funds are based on the enterprises’ new business purchases. Market conditions in 2022, including higher interest rates, reduced the total new business purchases compared with the previous year, reported FHFA.
