Biden Administration announces new efforts to help homeowners, buyers

The Biden Administration announced a series of new actions meant to broaden homeownership accessibility, ranging from pilot programs to changes in calculating income for qualifying mortgage borrowers. Several federal agencies made the announcements, including the U.S. Department of Housing and Urban Development (HUD) through the Federal Housing Administration (FHA), the U.S. Department of Agriculture (USDA), the Consumer Financial Protection Bureau (CFPB), and the Department of Veterans Affairs (VA).

The list includes an immediate change from FHA policy that allows lenders to count income from accessory dwelling units (ADUs) when underwriting a mortgage. This change will increase homebuyers’ ability to access affordable mortgage credit. ADUs, which are single habitable living units that can be added to, created within, or detached from primary single-family dwellings, can provide steady sources of rental income for homeowners. The change will particularly benefit first-time homebuyers, seniors, and inter-generational families leveraging ADUs.

“The new policies provide greater flexibility for the use of rental income from ADUs, which will help more borrowers qualify for FHA-insured financing on homes with ADUs,” said HUD Deputy Assistant Secretary for Single Family Housing Sarah Edelman. “We’re pleased that we’ve had such widespread support from the housing industry – support that has helped us deliver this meaningful solution for the nation’s homebuyers.”

FHA is also working on updating the 203(k) Rehabilitation Mortgage Insurance Program, which helps refinance homes needing renovation. The agency is considering policy changes that will increase funds available to borrowers making repairs and more time to complete those improvements.

The USDA is awarding $9 million in loans to nine Native American community development institutions (CDFIs). It is also launching a new pilot program to test alternative eligibility criteria for community land trust organizations through its Section 502 Direct Home Loan Program. USDA’s goal with the pilot is to expand access to affordable homeownership opportunities. CFPB is working on reforms to existing policies to help homeowners struggling to make mortgage payments. The reforms will focus on streamlining and simplifying processes. The VA will deploy a new home retention option in 2024, the VA Servicing Purchase (VASP) program, to help Veteran borrowers behind on their mortgages who do not qualify for traditional retention options.

Finally, the Department of Treasury released new data showing the impact of the Homeowner’s Assistance Fund through the American Rescue Plan. The data showed the fund expended $5.5 billion to help nearly 400,000 homeowners at risk of foreclosure. 

Keynote speakers announced for Solutions for Affordable Housing

On December 7, the National Housing Conference will host its Solutions for Affordable Housing convening at the National Press Club in Washington, D.C. National Economic Council Director Lael Brainard will join attendees to discuss the work the Biden Administration is doing to increase affordable housing for all Americans including the Administration’s Housing Supply Action Plan and work on racial equity. FHFA Director Sandra Thompson will participate in a fireside chat to discuss FHFA’s initiatives to expand homeownership and rental opportunities for all Americans through its oversight of the Federal Home Loan Banks, Fannie Mae, and Freddie Mac.

FHFA to host property insurance symposium

FHFA announced that it's hosting a symposium on Nov. 14-15 focused on recent property insurance challenges. The symposium will include several events, which will occur at FHFA’s headquarters in Washington, D.C., and online. FHFA’s intent is for the forum to host the exchange of ideas and exploration of solutions by stakeholders to address the property insurance needs of homeowners throughout the county as natural disasters increase in frequency and severity.

“Recent developments in property insurance markets have exacerbated concern over the ability of homeowners to obtain adequate and affordable insurance coverage for their homes, especially those located in climate-vulnerable areas,” an email for the event read. “Recognizing these developments and concerns, the purpose of the Symposium is to bring together stakeholders to discuss the threats to the housing finance sector stemming from climate risk, particularly as they affect the coverage and cost of insurance for single-family homeowners.”

Registration for the event is now open.

Freddie Mac launches downpayment assistance search tool

Freddie Mac announced a new tool, DPA One®, that matches borrowers to downpayment assistance (DPA) programs. Freddie Mac built the tool for mortgage lenders to find DPA for borrowers in a single source that aggregates and matches programs throughout the country. It is available immediately and free to lenders, housing counselors, and downpayment assistance program providers. Currently, 48 states have active DPA programs, with more defined areas coming online next year. The tool will simplify the search for DPA for providers and consumers. DPA is a vital resource for many looking to achieve homeownership, as saving for a downpayment remains a major obstacle for people otherwise qualified to purchase a home.

“Time and again research reveals that the down payment is the single largest hurdle first-time homebuyers need to overcome to attain homeownership. But finding and comparing the many programs and their guidelines is challenging,” said Sonu Mittal, Freddie Mac Single-Family Senior Vice President of Acquisitions. “DPA One delivers a one-stop shop at no cost that brings lenders and their borrowers greater detail and visibility into these programs, while seamlessly connecting the right assistance program with the lender, housing counselors and borrowers who need this assistance the most.”

GRRP allocates over $100 million to awardees

The Biden Administration unveiled the Green and Resilient Retrofit Program (GRRP) awardees, allocating over $100 million for energy efficiency and climate resilience upgrades in 1,500 low-income households. The GRRP, administered by HUD, supports families with modest incomes by substantially renovating their homes. The GRRP provides greener, safer, and healthier housing for HUD-assisted residents, ensuring they can better cope with extreme weather events.

“In the past few months alone, we’ve witnessed devastating climate events that have destroyed people’s lives and homes,” said HUD Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon. “We must protect and strengthen the homes in which Americans reside, particularly those occupied by our nation’s most vulnerable populations, which is why we’re working so hard to get climate resilience and energy efficiency resources into low-income communities across the country.”

Participating property owners can choose from three GRRP categories: elements for climate resilience and utility efficiency in ongoing projects, leading edge for advanced green certifications, and comprehensive for properties in critical need of upgrades. HUD will announce awardees throughout 2023 and 2024. To see the complete list of grantees, click here.  

HUD announces $40 million funding opportunity for service coordinators



HUD announced $40 million in funding through the Resident Opportunity and Self-Sufficiency (ROSS) Service Coordinator Program. This funding is open to Public Housing Agencies (PHAs), Tribes/Tribally Designated Housing Entities (TDHEs), multifamily owners, resident associations, and nonprofit organizations. ROSS aims to hire and retain service coordinators who will assess the needs of residents in public and Indian housing. These coordinators provide case management and facilitate access to community resources to address their needs. Eligible entities can apply through www.grants.gov.

“Service coordinators play a critical role in helping people in HUD-assisted housing navigate everyday challenges and reach long-term stability. This funding will ensure more individuals and families can access local tools and resources that meet them at their point of need,” said HUD Secretary Marcia Fudge. 

HUD expands initiative to bridge the digital divide

HUD announced the expansion of the ConnectHomeUSA (CHUSA) initiative, aimed at bridging the digital divide for HUD-assisted families. The initiative, which fosters collaboration between housing authorities and providers to promote digital inclusion, has so far benefited 100 communities. HUD will highlight the expansion at CHUSA’s summit, intended for communities, public housing authorities, stakeholders, and partners of digital inclusion and scheduled for Oct. 24-26. Registration for the summit is now available.

“When communities, especially low-income communities, lack adequate access to broadband internet, they face barriers to economic and educational opportunities. ConnectHomeUSA allows us to bridge those barriers and ensure people in HUD-assisted housing can get and stay connected,” said HUD Secretary Marcia Fudge.

Earlier this year, HUD signed a memorandum of understanding with the Federal Communications Commission to promote enrollment in the Affordable Connectivity Program for HUD-assisted families.