The Federal Housing Finance Agency (FHFA) recently issued an advisory bulletin that seeks to simplify the process for developers to receive Federal Home Loan Bank (FHLBank) funds for affordable housing projects.
The bulletin provides for a streamlined compliance process and eliminates uncertainty for project sponsors about the amount of their Affordable Housing Program (AHP) award. It also provides further clarity to the FHLBanks on determining the need for an AHP subsidy when a rental project includes capitalized reserves and supportive services, according to officials.
Each of the 11 FHLBanks operates an AHP, providing grants or subsidized advances to fund rental housing and homeownership opportunities for low- and moderate-income households. Nonprofits and other sponsors submit an application to the FHLBank, which includes a request for financial assistance to fill a project’s funding gap.
FHFA, which oversees the FHLBanks, has received feedback that the process is too burdensome.
“FHFA is simplifying the process of applying for AHP funding to expand the number of project sponsors and improve the FHLBanks’ ability to address affordable housing needs in their districts,” said FHFA director Sandra L. Thompson on Oct. 31. “Today’s advisory bulletin demonstrates FHFA’s focus on ensuring that the FHLBank System remains a cornerstone of support for affordable housing.”
Read the nine-page advisory bulletin here.
