The Federal Housing Finance Agency (FHFA) this week issued a public request for information for plans submitted by government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac under the Duty to Serve (DTS) program that aims to serve underserved markets from 2025 through 2027.

Established by the Housing and Economic Recovery Act (HERA) of 2008, the DTS plans for underserved markets encompass three primary areas: manufactured housing, affordable housing preservation and rural housing.

It requires the GSEs to “increas[e] the liquidity of mortgage investments and improv[e] the distribution of investment capital available to facilitate a secondary market for residential financing for very low-, low-, and moderate-income families in those underserved markets,” according to the document outlining the request for information.

“The DTS regulation specifies that each Enterprise must submit a three-year plan to FHFA describing the activities and objectives the Enterprise will undertake to serve each of the three underserved markets,” the document explained.

“The proposed plans were due to FHFA on May 10, 2024, and revised plans will be due in September 2024, after the conclusion of this 60-day public input period. FHFA expects to issue Non-Objections to the Enterprises’ revised Plans, where appropriate, by the end of 2024.”

As the U.S. wrestles with housing affordability challenges stemming from low inventory and elevated mortgage rates, these plans have an added degree of importance, according to FHFA Director Sandra Thompson.

“Providing sustainable liquidity for affordable housing preservation, rural housing, and manufactured housing in a safe and sound manner is a key component of the Enterprises’ statutory responsibility to serve underserved markets,” Thompson said in a statement. “I look forward to hearing the public’s input and feedback on the plans the Enterprises have proposed.”

FHFA issued a final rule in 2016 implementing the DTS requirements for the GSEs. Public comment has the potential to help shape the policies further, but FHFA retains final authority on the content of the plans. It will aim to “ensure compliance with the Enterprises’ Charter Acts, safety and soundness measures, and other conservatorship and regulatory requirements.”

The public comment period will remain open through Aug. 12, 2024. Interested parties can submit comments through the DTS page on FHFA’s official website, while the agency also plans to hold three listening sessions on July 15, 16 and 17 to review the proposals. Registration for these listening sessions is open now.

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