On July 9, 2013, The National Low Income Housing Coalition (NLIHC) filed a lawsuit against the Acting Director of the Federal Housing Finance Agency (FHFA) for failing to uphold Fannie Mae and Freddie Mac's statutory requirement to make contributions to the National Housing Trust Fund. NLIHC is a plaintiff for the lawsuit, alongside the Right to the City Alliance and several low income residents.
The National Housing Trust Fund, set up in 2008 as part of the Housing and Economic Recovery Act (HERA), aims to provide subsidies to rehabilitate and fund low-income housing. HERA requires that Fannie Mae and Freddie Mac transfer a portion of 0.042% of their new business to the Fund; however, this requirement was temporarily suspended by the FHFA Director when the two mortgage finance companies were taken into conservatorship. The 2012 Securities and Exchange Commission's filings show that new business activity for Fannie Mae and Freddie Mac was approximately $1.4 trillion. For the first quarter of 2013 (January-March), Freddie Mac has reported a net income of $4.6 billion and Fannie Mae reported a pre-tax income of $8.1 billion. As the conditions for the suspension no longer apply, the advocacy groups are demanding that FHFA make contributions to the Fund immediately, as required by HERA.
NLIHC states that once funded, the National Housing Trust Fund will begin to address the nationwide shortage of 7.1 million rental units that are affordable and available to the country's poorest households.
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