The Washington Report

On Wednesday, March 25, Judge Richard G. Stearns of the U.S. District Court of Massachusetts granted a temporary injunction stopping HUD’s termination of dozens of Fair Housing Initiatives Program (FHIP) grants. Fair housing groups had filed suit against HUD and DOGE after they terminated 78 HUD fair housing grants for organizations operating in 33 states.

FHIP grants, which are authorized by Congress and receive annual appropriations, have been provided for decades to fund local community efforts to educate the public about housing discrimination and investigate fair housing complaints.

On February 27, affected organizations received a letter stating that the funding "no longer effectuates the program goals or agency priorities."

The court ordered HUD to immediately restore the funding and temporarily enjoined HUD from terminating any FHIP grant except to the extent authorized by statute, regulation, and the court.

Download the Temporary Restraining Order

On March 21, 2025, the Financial Crimes Enforcement Network (FinCEN) issued an interim final rule amending the Beneficial Ownership Information Reporting Rule. Under the recommended interim rule, U.S. companies and persons required to report beneficial ownership information to FinCEN in accordance with the Corporate Transparency Act would be removed, and only foreign entities and companies would be required to report. FinCEN is seeking comments over the next 60 days from stakeholders regarding the final rule. NAR is still reviewing the rule, and will continue to provide updates. 

For more information regarding the beneficial ownership information rule, please visit www.fincen.gov/boi.

On Tuesday, March 25th, Federal Housing Finance Agency (FHFA) Director Bill Pulte announced a collection of policy changes for Fannie Mae and Freddie Mac (the GSEs) and the Federal Home Loan Banks. Most of the changes are an effort to walk back previous policy moves from former Director Sandra Thompson, though there was a positive clarification regarding loan limits.

The policy changes and announcements include:

• A clarification, via media interview, that FHFA does not intend to reduce loan limits, the ceiling set annually for which the GSEs can purchase mortgage loans. This is especially important for maintaining access to credit in high-cost areas. While loan limits are statutorily set and must increase or decrease with FHFA's House Price Index, there were questions as to whether FHFA could freeze the loan limits for upcoming years.
• An order rescinding a previous directive which required the GSEs to include certain tenant protections as a condition of new, funded multifamily housing. NAR has previously written to FHFA opposing these provisions.
• A directive to end the GSEs' participation in Special Purpose Credit Programs (SPCPs). These programs allow lenders to design products to specifically advantage an historically economically disadvantaged group of people. This directive does not preclude lenders from creating their own SPCPs and funding them themselves. NAR has policy supporting the use of SPCPs.
• A waiver of the GSEs' requirements to comply with the Equitable Housing Finance Plans. These plans aimed to narrow the homeownership gap and included SPCPs as a solution. The GSEs were currently implementing and executing plans that had been approved by FHFA and the previous director.
• A directive to Fannie Mae to end its "Repair All" strategy for its real-estate owned (REO) inventory. The program hoped to increase the repair rate of REO properties to help increase the likely attraction to single-family buyers. This was seen as a move to compete with single-family investors that would buy the property in any condition.
• An order rescinding a previous advisory bulletin giving the GSEs guidance on how best to identify and assess climate risk and monitor on an ongoing basis. The GSEs act as insurers and often absorb losses due to natural disasters if the homeowner does not have adequate forms of insurance. Insurance programs are increasingly incapable of covering losses, and this change may mean the GSEs will have to absorb greater losses or require further funds or bailouts from the federal government.
• An order rescinding a previous advisory bullet which required the GSEs and the Federal Home Loan Banks to monitor for unfair, deceptive, and abusive acts and practices (UDAAP). This directive removes regulatory overlap and places the oversight of squarely with the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC).

The recent changes appear to be steps to remove policies that were in line with President Biden's housing policy agenda and seem less geared towards a departure from conservatorship, nor do they create notable cost savings.

NAR will continue to monitor these developments and the effects on housing affordability, housing access for all potential borrowers, lender oversight, and the market as a whole.

On Tuesday, March 25th, Federal Housing Finance Agency (FHFA) Director Bill Pulte released a directive eliminating the GSEs’ participation in Special Purpose Credit Programs (SPCPs).

SPCPs are targeted lending products designed to specifically advantage groups historically denied credit due to discrimination. While broader adoption of SPCPs didn’t occur until recently, the programs have been legal and allowable since 1974 due to a provision in the Equal Credit Opportunity Act to reverse centuries of unfair laws and practices. The programs can take many forms, but the most common products included downpayment assistance, closing-cost assistance, and rate buydowns.

While Director Pulte’s announcement puts an end to SPCPs that would be available for purchase at the GSEs, it does not eliminate SPCPs entirely. In fact, the FHFA Director has no authority to eliminate SPCP loans that are not presented to the GSEs for purchase—lenders can still offer SPCPs on their own and fund them through their own portfolios. However, not all lenders have the capital to execute the programs in this manner. The majority of mortgages secured in the country today are originated by non-bank lenders without deposits to fund their own loans. Therefore, although lenders may continue to offer SPCP loans, the recent action by FHFA significantly dries up capital available for them.

According to FHFA, In 2023, the GSEs acquired 14,968 mortgages originated through SPCPs. While the number of loans originated by banks and non-banks and held on portfolio is hard to estimate, the programs have shown great potential with little downside or enhanced risk to lenders or the GSEs. SPCPs still go through traditional underwriting and must comply with Ability to Repay standards set by the Dodd-Frank Act.

The growth of the programs has been limited in the last few years for a number of reasons. First, the high-interest rate environment has added another high hurdle for potential buyers to clear. While downpayment and closing costs assistance can help borrowers at the closing table, the high interest rates, a whole 3-4% higher than rates were in 2021, proved a barrier too large for many. Additionally, higher taxes and insurance costs have added more impediments to communities already struggling to qualify for a mortgage.

Recently, NAR passed policy promoting the use of SPCPs, either purchased by the GSEs or run by lenders themselves. NAR will continue to advocate for policies and solutions that help on both the supply and demand side of housing.