Sponsors (3)
Official title: To require that any amounts received by the Federal Government as a result of the release of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation be used for State housing revolving loan funds for middle-class housing supply, and for other purposes.
Introduced June 30, 2025 by Thomas Suozzi · Last progress June 30, 2025
The bill creates a time‑limited, dedicated trust and state revolving loan funds that expand affordable housing access—especially for middle‑income households—by providing low‑cost, long‑lived financing and job requirements, but it shifts costs and constraints to states (matching and repayment), excludes deepest‑poverty supports, increases administrative and labor costs, and limits federal flexibility.
Middle‑income households (80–165% AMI) get expanded access to newly built or rehabilitated affordable rental and homeownership units through state loan fund financing.
States and localities gain low‑cost, revolving capital (interest‑free or below‑market loans) they can re‑lend to finance housing projects, lowering financing costs and increasing local capacity without immediate new appropriations.
A 10‑year lock on Fannie Mae/Freddie Mac proceeds creates a predictable, dedicated funding stream for housing programs, giving states certainty to plan and implement projects during that window.
Lowest‑income households are largely left out: funds cannot be used for public housing modernization or tenant‑based Section 8 vouchers, limiting help for the poorest renters and public housing residents.
State and local governments face new fiscal pressures: a required 20% non‑Federal cash match and an obligation to repay capitalization loans after 10 years could strain budgets, force cuts, or require new revenues.
Locking proceeds into a restricted trust for ten years reduces federal flexibility to redirect those funds to other urgent priorities during that period.
Based on analysis of 3 sections of legislative text.
Creates a HUD capital loan program using Fannie/Freddie proceeds to capitalize State revolving loan funds for middle‑income housing; States must repay loans after 10 years to reduce the deficit.
Creates a HUD-administered revolving loan capitalization program that uses proceeds the federal government receives from releasing Fannie Mae and Freddie Mac to capitalize State housing revolving loan funds. States receive capitalization loans to finance loans or loan guarantees for local governments and nonprofits to build or rehabilitate housing targeted to middle‑income households; after 10 years, States must repay those capitalization loans to the Treasury and those repayments are dedicated to deficit reduction. Sets limits on eligible and ineligible uses, requires State agreements and accounting standards, allocates funds among States by formula that weights need and housing costs, and restricts how State loan fund deposits, repayments, and interest may be used (primarily for lending, guarantees, reserves, and related reasonable planning/admin costs).