Affordable Housing Programs

The FHLBank System is unique among government-sponsored enterprises due to its public policy responsibilities and its role in housing finance. In addition to providing on-demand liquidity to member financial institutions, the System also delivers on its commitment to promote community development through two of the nation's most successful ongoing housing initiatives: the Affordable Housing Program (AHP) and the Community Investment Program (CIP).  In fact, the AHP won the 2010 "Housing Person of the Year" award from the National Housing Conference.

AHP subsidizes the interest rates for loans to member financial institutions, and provides direct subsidies to members making loans for the purchase, construction, or rehabilitation of very low- to moderate-income owner-occupied or rental housing. This program is designed to encourage the creation of innovative lending efforts by members to increase affordable housing stock. Since inception, about $4.6 billion in subsidies have been awarded by the FHLBanks, helping to finance more than 776,000 housing units that otherwise might not have been built.*

CIP provides funds for community-oriented mortgage lending for families whose incomes do not exceed 115% of the area median. CIP also directs lending towards economic development activities that are located in low- to moderate-income neighborhoods. Total CIP lending now exceeds $64 billion, financing nearly 745,000 housing units, thousands of economic development projects, and creating over 223,000 jobs.*

Through these programs, the FHLBanks have funded over 1.5 million housing units since 1990.

The FHLBanks pursue these commitments vigorously on their own merits, without great fanfare. A little known fact: the FHLBanks are involved with one of every four homes built by Habitat for Humanity - about 7,000 in the last 10 years. This is one example of how strong and prosperous neighborhoods are built. Successful economic development efforts occur when local residents, community officials, county and state agencies, banks, landowners, non-profits and others commit time and resources to creating healthier neighborhoods. Successful community development is about creating community wealth. Each neighborhood has gifts, resources and talents that can be nurtured to build a more cohesive, prosperous community. Focus on a community's inherent assets and strengths, and every step forward builds community wealth.

Successful community development requires partners that can lend expertise, resources and commitment - filling in the gaps between what already exists and what is still needed. The FHLBank System is such a partner. To fulfill the System's mission, new challenges must be met and new products developed.

Here are some facts about FHLBank affordable housing programs:

  • The AHP and CIP Programs were created by Congress under the Financial Institutions Reform, Recovery and Enforcement Act of 1989
     
  • AHP grants can subsidize construction, purchase and/or rehabilitation of owner-occupied and rental housing for very low-, low- and moderate-income households
     
  • AHP funds can be used for construction financing, permanent financing, principal reduction, down payment assistance or interest rate buy-down
     
  • Since inception, the FHLBanks have funded AHP with 10 percent of annual net earnings, or a minimum of $100 million annually
     
  • Total AHP commitments/contributions averaged over $200 million annually between 2003 and 2010 - with $239 million in 2011.
     
  • AHP contributions since inception total nearly $4.6 billion and have helped create over 776,000 housing units
     
  • If AHP were a stand-alone foundation, it would be the largest housing foundation in the country by a wide margin (measured by total commitments)
     
  • CIP makes loans available for home purchase or rehabilitation to families whose incomes do not exceed 115% of the area median
     
  • CIP lending since inception exceeds $64 billion, financing over 744,000 housing units and thousands of economic development projects

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    FHLBank of SeattleFHLBank of SeattleFHLBank of SeattleFHLBank of San FranciscoFHLBank of Des MoinesFHLBank of TopekaFHLBank of DallasFHLBank of AtlantaFHLBank of CincinnatiFHLBank of ChicagoFHLBank of IndianapolisFHLBank of PittsburghFHLBank of New YorkFHLBank of New YorkFHLBank of Boston

    Additional information on these programs is available from the Community Investment Officer at any FHLBank, or from the Federal Housing Finance Agency, 400 7th Street, SW, Washington, DC 20024. Phone: (202) 649-3800. Email: FHFAinfo@fhfa.gov.

    * Source: Federal Housing Finance Agency