Freddie Mac headquartersWASHINGTON, DC–Freddie Mac has announced it will start purchasing community land trust mortgages as part of its support for shared equity homeownership programs that preserve affordable housing.
It has already collaborated on several projects across the nation including one in Anacostia, according to a statement by Ginger Rumph, executive director, Douglass Community Land Trust / City First Homes. “Our collaboration with Freddie Mac to develop a product in support of a community land trust in the Historic Anacostia neighborhood, and Wards 7 and 8 in Washington, DC, will pave the way for a model that can be replicated in similar geographic areas across the country,” he said.
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The Freddie Mac community land trust mortgage is meant to make it easier for lenders to do business in the shared equity homeownership field by increasing communication and collaboration between the servicer and the community land trust organization, the GSE said.
“In developing the Community Land Trust Mortgage offering we were able to take a fresh look at existing mortgage products in this space, listen to the needs in the housing industry and collaborate with leading organizations to bring this innovative offering to market,” said Mike Dawson, vice president of affordable strategy and policy at Freddie Mac's Single-Family Business, in a prepared statement.
As part of the offering, Freddie Mac has built alliances with national, state and local community organizations such as the Grounded Solutions Network, City First Homes and the Florida Housing Coalition, among others.
Freddie Mac's new servicing requirements for community land trust mortgages including giving borrowers additional time if they miss their mortgage payments.
The new mortgage offering is available November 5.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
