Expanded Loan Options Could Help More Americans Buy Low-Cost Homes

On Aug. 12, 2024, The Pew Charitable Trusts sent a letter to the Federal Housing Finance Agency (FHFA) regarding Fannie Mae and Freddie Mac’s proposed 2025-27 plans related to the “Duty to Serve” rule, which requires them to provide a viable secondary loan market for very low-, low-, and moderate-income Americans, with an emphasis on manufactured and rural housing as well as affordable housing preservation.

Pew’s letter praised Fannie and Freddie for their commendable efforts since 2018 to expand access to manufactured home mortgages. But it also noted that more can be done to reach underserved populations, especially given the nation’s historically low housing supply and high costs. In particular, expanding access to safe and affordable financing is key to boosting people’s ability to buy manufactured homes, which offer a high-quality homeownership option for low- and moderate-income Americans.

Pew’s letter suggested several improvements to Fannie and Freddie’s proposal: establishing a personal property loan program, a sentiment that was echoed by most stakeholders during a recent FHFA listening session; increasing the targets for the number of loans that Fannie and Freddie purchase; and expanding real estate mortgages and refinancing opportunities to currently ineligible credit-ready homebuyers and owners. Additionally, Pew recommended researching the efficacy of, and considering updates to, lease protections for manufactured home owners who rent their land to promote stability.