The U.S. Department of Housing and Urban Development (HUD) this year took bold action in pursuit of the agency’s mission to create strong, sustainable, inclusive communities and quality affordable homes. These actions aligned with key Biden-Harris Administration priorities including ensuring equity, removing barriers to homeownership, expanding the nation’s housing supply, and keeping Americans housed.
Below are highlights of some of the agency’s actions from 2021.
Launched a Whole-of-government Effort to Ensure All Americans Are Treated Fairly in the Home Appraisals Process. On June 1, President Biden tasked Secretary Fudge with leading a first-of-its-kind interagency initiative to address inequity in home appraisals. In partnership with the Domestic Policy Council, HUD created the Property Appraisal and Valuation Equity (PAVE) Task Force, bringing together 15 federal agencies to identify and utilize all levers at their disposal to root out discrimination in the appraisal and homebuying process. The Task Force has been exploring the extent, causes, and impacts of misvaluation faced by communities of color, gathering input from industry, advocates, and other stakeholders, and developing new policy approaches around guidance and enforcement. This work will be presented to the President and the public early next year, documenting the scope of the problem and providing detailed, actionable agency commitments and recommendations for next steps.
Launched All-Hands-on-Deck Effort to Address Homelessness Crisis. On September 20, Secretary Fudge launched House America, a national partnership with other Administration officials, mayors, county officials, governors, and tribal nation leaders across the nation. The plan works with those leaders to use American Rescue Plan (ARP) resources to re-house at least 100,000 people experiencing homelessness and add at least 20,000 new affordable and permanent supportive housing units to address homelessness into the development pipeline by the end of 2022.
Eviction And Foreclosure Prevention. HUD helped prevent eviction of HUD-assisted households and stabilize families struggling because of the COVID-19 pandemic by deploying the historic funding made available under the Consolidated Appropriations Act and ARP to help keep families stably housed. HUD worked closely with the White House and the Treasury Department, providing the Department’s expertise to help FAQs and best practices for the Emergency Rental Assistance Program. HUD also helped homeowners who may have been behind on their mortgages stay in their homes and worked with Treasury to engage stakeholders around the utilization of the Homeowner Assistance Fund and its integration with new policies released by the Federal Housing Administration (FHA) to help struggling homeowners keep their homes.
Stood Up a New $5 Billion HOME-ARP Program to Assist Some of The Country’s Most Vulnerable Populations. HUD successfully stood up a brand new $5 billion program to assist some of the country’s most vulnerable populations including individuals or households who are homeless or at risk of homelessness. The Office of Community Planning and Development has made funding available to 651 state and local governments, which will be used to reduce homelessness and increase housing stability by providing funding for rental housing development, acquisition and development of non-congregate shelter, tenant-based rental assistance, and supportive services. HUD released a portion of grantee administrative funds at the outset of the program to better support the planning activities that lead to effective use of grant funding.
Removed Barriers to Homeownership for Those with Student Loan Debt. The Federal Housing Administration (FHA) updated its policy on student loan monthly payment calculations to remove barriers and provide more access to affordable single-family FHA-insured mortgage financing for creditworthy individuals with student loan debt, which has disproportionate impact on communities of color. The updates removed the previous requirement that lenders calculate a borrower’s student loan monthly payment of one percent of the outstanding student loan balance for student loans that are not fully amortizing. The new policy bases the monthly payment on the actual student loan payment, more closely aligning FHA policies with industry standards.
Set the Stage for Increased Fair Housing and Lending Enforcement and Access. HUD signed a memorandum of understanding (MOU) with the Federal Housing Finance Agency (FHFA) to kick off a historic collaboration on fair housing and fair lending enforcement and oversight engagement with the FHFA-regulated entities including Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. This comprehensive effort will ensure deeper collaboration on fair housing investigations and enable data sharing to help strengthen and affirmatively further fair housing for the mortgage industry. In addition, HUD Published a legal memorandum making it clear that certain Special Purpose Credit Programs (SPCPs) that are lawful under the Equal Credit Opportunity Act (ECOA) generally are not barred by the Fair Housing Act, allowing their use by lenders to expand access to credit in underserved communities.
Took Action to Increase Housing Supply and Access to Affordable Housing. HUD restarted its Housing Finance Agency (HFA) risk-sharing program with Treasury’s Federal Financing Bank (FFB) on September 1 to develop more affordable rental homes. The program allows HFAs to obtain FHA insurance on multifamily mortgages they underwrite, with HUD and the HFA sharing the risk of any potential loss. FHA anticipates that approximately 20,000 affordable rental homes will be created or preserved through the program through 2027. HUD also made more single-family homes available to individuals, families, and non-profit organizations – rather than large investors – by prioritizing homeownership and limiting sale to large investors of certain FHA-insured and HUD-owned properties. HUD also released new research on actions that state and local governments can take to increase their housing supply and is developing a Housing Supply Toolkit filled with easy-to-implement strategies for grantees to deploy HUD resources to address supply and affordability challenges that have been deepened by the pandemic.
Restored the Affirmatively Furthering Fair Housing (AFFH) Requirement. The Department published an interim final rule (IFR) that went into effect on July 31st to restore the implementation of the Fair Housing Act’s AFFH requirement. Under the restored AFFH regulatory definition in the IFR, HUD funding recipients must regularly certify compliance with the Fair Housing Act’s AFFH requirement and commit to taking steps to remedy their fair housing issues in making such certifications. The IFR helps HUD, 3,747 public housing authorities, and 1,200 state and local government grantees in the CDBG, HOME, and HOPWA programs fulfill their AFFH obligations under the Fair Housing Act.
Historically Strong Mutual Mortgage Insurance (MMI) Fund. HUD announced a historically strong Mutual Mortgage Insurance Fund Report showing that, in addition to its emphasis on delivering relief options to homeowners financially impacted by the COVID-19 pandemic, FHA continued to deliver on its mission of enabling homeownership for first-time and low- and moderate-income, and households of color. The Fund remains well positioned to withstand future economic events and endure the outcomes from the pandemic-induced delinquencies that remain in forbearance or are seriously delinquent. The percentage of first-time homebuyers using FHA insurance reached a new high, the share of mortgages insured by FHA to minority borrowers reached almost 42 percent of all FHA forward mortgage insurance endorsements. FHA served double the percentage of Black and Hispanic borrowers when compared to those served through mortgage originations by the rest of the housing market this past fiscal year.
Protected the LGBTQ+ Community from Housing Discrimination. On February 11th, HUD announced that it would interpret the Fair Housing Act to bar discrimination on the bases of sexual orientation and gender identity, consistent with President Biden’s Executive Order 13988 and the Supreme Court’s ruling in Bostock v. Clayton County. This decision has expanded the protections of the Fair Housing Act to a community that has historically been subject to discrimination. Through its partner FHIPs and FHAPs agencies, HUD has processed 235 cases alleging sex discrimination due to gender identity and sexual orientation last year, nearly twice as many cases than last year.
Developed and Released HUD’s Climate Action Plan. On November 11th, HUD released a comprehensive, Agency-wide Climate Action Plan, which details a strategy to reduce the agency’s energy and carbon footprint and put our nation’s communities on the path to building more equitable, efficient, and sustainable housing infrastructure. The Climate Action Plan was developed in response to President Biden’s Executive Order on Tackling the Climate Crisis at Home and Abroad. In keeping with the executive order, as well as the President’s Justice40 Initiativeto advance environmental justice and racial equity, HUD will implement a broad approach to the climate crisis that reduces climate pollution; increases resilience to the impacts of climate change; protects public health; delivers environmental justice; and spurs well-paying union jobs and economic growth.
Helped Communities Rebuild from Disasters. In November, HUD announced the allocation of more than $2 billion in disaster funding for communities in 10 states covering 15 major disasters—including wildfires in California, hurricanes in Louisiana, and earthquakes in Puerto Rico. And we will keep working with our partners to deliver relief for other communities rebuilding in the wake of natural disasters—including tornado victims in Kentucky. Additionally, HUD has taken meaningful action to reset its relationship with Puerto Rico and the U.S. Virgin Islands and to address ongoing recovery and resilience needs. This includes obligating long-awaited disaster recovery funds and removing onerous restrictions placed on the grants, such as incremental grant obligations, Federal Financial Monitor review, and more. Now, ninety percent of promised funds have been obligated to Puerto Rico, an increase of $16B since the start of the Administration.