Housing Finance Part I Freeman

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Housing Finance Part I Freeman

  1. 1. Community Investment Services FHLBank Atlanta
  2. 2. <ul><li>Shareholder/customer dynamic </li></ul><ul><li>Have not experienced a credit loss in 75 years </li></ul><ul><li>Annual reinvestment of at least 10 percent of net income into affordable housing </li></ul>Characteristics of FHLBank Atlanta as a Cooperative Members FHLBank Stock Advances Community Dividend
  3. 3. <ul><li>FHLBank Atlanta views the 10 percent income allocation as the dividend that we pay the community </li></ul><ul><li>Like every other dividend, the payment is predicated upon the positive financial performance of FHLBank Atlanta </li></ul>The Community Dividend
  4. 4. AHP Community Dividend Community Financial Institution FHLBank Community Grows Developer requests funds for Affordable Housing Development Member institution applies for funds from FHLBank Atlanta FHLBank Atlanta approves funding on competitive basis Funds are invested in the community How We Grow Communities
  5. 5. Stimulated Growth in local communities by providing products that revitalize neighborhoods, create jobs, and support economic development $377 Million through FHLBank Atlanta’s Affordable Housing Program to support more than 61,000 housing units Since 1990 $3.2 Billion in “subordinate, equity-like” capital has been awarded Our Successful Mission FHLBanks
  6. 6. Community Investment Initiatives Affordable Housing Program (AHP) Community Investment Program (CIP) First-time Homebuyer Program (FHP) Economic Development Program (EDP)
  7. 7. <ul><li>Funding to create rental and homeownership opportunities for moderate-, low- and very low-income households </li></ul><ul><li>Beneficiaries </li></ul><ul><ul><li>Residents at or below 80 percent of Area Median Income (AMI) </li></ul></ul><ul><li>Competitive Application Process </li></ul><ul><li>Uses </li></ul><ul><ul><li>New construction or rehabilitation </li></ul></ul><ul><ul><li>Acquisition </li></ul></ul><ul><ul><li>Permanent financing </li></ul></ul><ul><ul><li>Down payment and closing cost assistance </li></ul></ul>Affordable Housing Program (AHP)
  8. 8. Enhancements for AHP 2009-2010 Improve member and sponsor customer service levels and Expedite funding of projects Position AHP to assist in solving big problem in the district and the country – foreclosure crisis Increase front-end analytical rigor and due diligence Reward member financial commitment in AHP projects Member Financial Participation Foreclosure Prevention Project Readiness Enhanced Analytical Environment
  9. 9. Desired Outcome for AHP More Ready Projects Reduce Project Modification Expedite Funding Application requirements and process improvements leading to higher levels of customer service Decrease Project Extensions
  10. 10. First-time Homebuyer Program (FHP) <ul><li>Down payment and closing cost assistance </li></ul><ul><ul><li>5:1 Match (Minimum borrower contribution of $500) </li></ul></ul><ul><ul><li>Maximum $10,000 per borrower </li></ul></ul><ul><ul><li>Registered members eligible for up to $1,000,000 per year </li></ul></ul><ul><ul><li>First-come, first-served </li></ul></ul><ul><li>Benefits homebuyers at or below 80 percent AMI </li></ul><ul><li>Five year retention agreement </li></ul>
  11. 11. Using FHP to Win First-Time Homebuyers <ul><li>FHP used by members to compete for highly sought-after new customers </li></ul><ul><ul><li>Members marketed FHP as an incentive for customer to use member’s mortgage products </li></ul></ul><ul><li>Proven results with members </li></ul><ul><ul><li>During 2008, FHLBank Atlanta supported over $17MM to members’ First-Time Homebuyer lending activities, resulting in almost 2,000 member-originated first mortgages </li></ul></ul><ul><li>In 2009, nearly $10MM will support members’ customer acquisition campaigns </li></ul><ul><ul><li>FHLBank Atlanta made significant changes to underwriting guidelines to further responsible lending and customer service commitments </li></ul></ul>
  12. 12. FHP (1997 – 2008) … Every $1 of FHP generates $17 in new mortgage business for our members
  13. 13. Demand For FHP Funding <ul><li>Fed Sees Some Home Buying Up </li></ul>“ Residential real estate markets continue to bounce back from the doldrums of the recession, according to a Federal Reserve report released Wednesday.” “ The central bank's Beige Book found higher year-over-year home sales in the Atlanta, New York, Cleveland and Minneapolis districts.” “ Still, most of the activity in the residential market is happening at the lower end of the spectrum, thanks to first-time homebuyer tax credits.” American Banker  |  Thursday, September 10, 2009
  14. 14. Community Investment Program (CIP) and Economic Development Program (EDP) <ul><ul><li>Discounted advances (up to 10 basis points) </li></ul></ul><ul><ul><li>Always available, simple application, no maximum amount </li></ul></ul><ul><ul><li>Complements government programs </li></ul></ul><ul><ul><li>One advance can fund multiple loans </li></ul></ul><ul><ul><li>Discounted loans approaching $5 billion </li></ul></ul>
  15. 15. <ul><li>Business Development and Relationship Management </li></ul><ul><li>Jackson Cosey </li></ul><ul><li>ShaDonte Dozier </li></ul><ul><li>Louis Freeman </li></ul><ul><li>800.536.9650 www.fhlbatl.com </li></ul>Webinars Sponsorships In-market workshops Forums How We Connect
  16. 16. We are happy to help. Do You Have Any Questions? ? ? ?

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