Mission Index & Social Bond Program FAQ

The Mission Index is the Enterprises’ aligned and enhanced disclosure that provides insights into mission-oriented lending activities underlying our Single-Family mortgage-backed securities (MBS). It scores each Single-Family MBS the Enterprises issue on ten criteria, focusing on income, borrower, and property attributes that align to many of our statutory affordable housing responsibilities or other important mission goals. The Mission Index serves as the foundation for Enterprise-aligned Single-Family Social Bonds. These bonds will offer investors the ability to invest in Single-Family MBS featuring high concentrations of loans consistent with our mission and Duty to Serve goals. In turn, investor demand for these MBS may result in lenders focusing more on lending to those same populations.

Freddie Mac encourages lenders to continue to serve the borrowers and communities which the Mission Index and Social Bond program are intended to support. How can I ensure my loans and MBS pools are considered?

Every loan acquired by Freddie Mac, whether through our Cash Window or through our Guarantor path, is reviewed to determine if it meets one or more of the ten mission criteria and to calculate a Loan-level Score that reflects the number of mission criteria satisfied. The corresponding pools are assigned a Mission Criteria Share (MCS) value which represents the percentage of loans within the pool that meet at least one of the ten mission criteria. The pool is also assigned a Mission Density Score (MDS) which represents the average of the Loan-level Scores for the pool.

No, the criteria are established as part of the Mission Index framework. Although the adaptable design allows the criteria to be adjusted, added, or removed over time as conditions change, we will strive to adjust the Index no more frequently than every 24 months. Advance notice will be provided ahead of any planned updates.

The new name will apply to all Single-Family MBS pools, outstanding and new issuance, beginning with March 2024 issuance.

The updated formulation will apply to all pools for Fannie Mae beginning with March 2024 issuances and for Freddie Mac beginning with June 2024 issuances. Previously issued pools will not be re-scored.

Fannie Mae and Freddie Mac expect to assign labels to Single-Family MBS meeting the Social Bond criteria beginning in June 2024.

Second Homes receive a score of 0 across all criteria (and by extension, 0 for the aggregate loan-level Mission Score). They are NOT counted when determining an individual pool’s eligibility to receive MDS and MCS disclosures (pools with 9 or fewer loans receive masked scores of 7s). Seasoned loans (aged more than 12 months at acquisition) receive a score of 0 across all criteria and ARE counted when determining MDS and MCS disclosure eligibility (only Second Homes are excluded from the loan count; Seasoned loans are INCLUDED).

Yes, Freddie Mac and Fannie Mae worked closely, and in alignment with the Federal Housing Finance Agency (FHFA), to evolve the Mission Index based on market feedback. The Enterprises are aligned in the Mission Index disclosures and our Single-Family Social Bond Frameworks.

To learn more, visit our Social Index webpage.