Fundamental to our mission, Freddie Mac has long been active in affordable housing preservation. To build on our commitment, we have added new and revised underwriting flexibilities for mortgages secured by income-based resale restricted properties sold under affordable housing programs that aim to preserve affordability over time. These flexibilities include:

  1.  The use of the Affordable Seconds® financing option to subsidize the purchase price
  2. The ability for Subsidy providers of Affordable Seconds options to participate in appreciation under certain scenarios
  3. Simple guidelines to appraise properties with resale restrictions
  4. The ability for subsidy providers to receive excess proceeds if resale restrictions survive foreclosure or deed-in-lieu of foreclosure in certain instances

Our new and revised flexibilities support programs with resale restrictions that terminate or survive foreclosure. We require the restrictions to be included in a separate easement, restriction, covenant or condition in a deed or other instrument. Additionally, we require that Nonprofits, state and local governments or municipalities impose the resale restrictions.

Read Seller/Servicer Guide (Guide) Chapter 4406.

For additional financing solutions to support shared equity homeownership, please see our Community Land Trust Mortgages