Federal mortgage: Freddie Mac announces multi-billion dollar bond program focused on affordable housing
The company plans to offer at least $ 3 billion in affordable housing bonds by the end of 2022
MCLEAN, Virginia, October 7, 2021 (GLOBE NEWSWIRE) – Freddie mac (OTCQB: FMCC) announced today that the company plans to offer at least $ 3 billion in affordable single-family housing bonds. This new bond program will support affordable homeownership and serve historically underserved markets. To underline this effort, the company will today offer approximately $ 285 million in Uniform Mortgage-Backed Securities ™ backed by loans purchased through its Home Possible.® program.
“Freddie Mac is committed to creating additional opportunities for families to access quality housing and today we are announcing major action in support of this goal,” said Michael DeVito, CEO of Freddie Mac. “Through this new multi-billion dollar affordable housing bond program, we are providing targeted liquidity, stability and affordability designed to provide sustainable home ownership opportunities to low-income borrowers across the country.” . It also aims to give investors a vehicle to invest in underserved communities. ”
Freddie Mac’s Home Possible Mortgage offers a three percent down payment solution, which helps potential buyers with very low or low income overcome the number one barrier to homeownership: making a down payment. . Possible home mortgages are only available to families with incomes equal to or less than 80% of the region’s median income.
“This bond offering is another way for Freddie Mac to provide additional support to the housing market and is part of our overall effort to address long-standing issues of housing inequality,” said Pam Perry , Vice-President, Fairtrade Single-Family Housing. “In the future, expect us to expand this offering and strengthen our commitment to this important work.”
In addition to its down payment requirement of as little as three percent, Home Possible offers very low and low income borrowers some important additional benefits, including:
- Reduced mortgage insurance coverage requirements, which allow for a lower monthly payment and support affordable and sustainable home ownership. Mortgage default insurance is cancellable when it reaches 20 percent of equity, saving thousands of dollars over the life of the loan.
- Reduced credit charges, which allow a lower borrower monthly payment.
- Flexible sources of down payments, such as down payment, giveaways, and equity assistance, which can be used for down payment and closing costs.
- Responsible home ownership through education and guidance required for first-time home buyers, which can be fulfilled by products such as CreditSmart® Homebuyer U, Freddie Mac’s free online homeownership course.
Freddie Mac has purchased more than 81,000 Home Possible mortgages in the first six months of 2021 and made homeownership possible for more than 623,000 families with $ 121 billion in Home Possible mortgages since 2015.
Home Possible’s current fully loan-backed securities offering builds on Freddie Mac Multifamily’s existing impact bond issues, which include Green Bonds, Sustainability Bonds and Social Bonds. Multifamily has created impact bonds to support the division’s mission-driven work and has issued more than $ 8.5 billion through these vehicles to date. Separately, Freddie Mac Single Family has issued $ 425 million in green bonds since April 2021.
Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our inception by Congress in 1970, we’ve made housing more accessible and affordable for buyers and renters in communities across the country. We are building a better housing finance system for buyers, tenants, lenders, investors and taxpayers. Learn more on FreddieMac.com, Twitter @FreddieMac and Freddie Mac’s blog FreddieMac.com/blog.
UMBS Home Possible Mortgage Backed Securities (as described above) have not been designed to meet the social or sustainability criteria of a third party executive. Therefore, we cannot guarantee that these securities will be suitable for any particular “social” investment mandate or strategy. Investors should consult their own governance and investment guidelines to determine the suitability of such securities.
This is not an offer to buy or sell Freddie Mac securities. Offers for any given security are only made through the applicable offering circulars and related supplements, which incorporate Freddie Mac’s most recent annual report on Form 10-K filed with the Securities and Exchange Commission ( SEC); all other reports filed by Freddie Mac with the SEC in accordance with Section 13 (a) of the Securities Exchange Act of 1934 (Exchange Act), excluding any information “provided” to the SEC on Form 8 -K; and all documents that Freddie Mac files with the SEC in accordance with Sections 13 (a), 13 (c) or 14 of the Exchange Act, excluding any information “provided” to the SEC on Form 8- K.
The financial and other information contained in this announcement and in the documents accessible through this announcement are valid only as of the date of these documents. The information could be out of date and no longer accurate. Freddie Mac assumes no obligation, and disclaims any duty, to update the information contained in these documents.
These documents may contain forward-looking statements. Forward-looking statements involve known and unknown risks and uncertainties, some of which are beyond the control of the company. Management’s expectations for the future of the Company necessarily involve a number of assumptions, judgments and estimates, and various factors could cause actual results to differ materially from the expectations expressed in these forward-looking statements and ‘others. These assumptions, judgments, estimates and factors are discussed in the company’s most recent annual report on Form 10-K, and its reports on Form 10-Q and Form 8-K, which are available on the Investor Relations page. of the company’s website. at http://www.freddiemac.com/investors and the SEC website at www.sec.gov. The company does not undertake to update any forward-looking statements it makes to reflect events or circumstances occurring after the date of this announcement.
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