Upset with its regulator’s final rule setting out affordable housing goals, Freddie Mac is lobbying Congress for relief.

Senate aides confirmed Friday that Freddie is trying to get Congress to alter the rules that determine how it achieves its affordable housing goals, which are set and overseen by the Department of Housing and Urban Affairs.

The goals are meant to spur both Freddie and Fannie Mae into serving low-income housing needs. For next year, 50% of the mortgages purchased by the government sponsored entities must be loans to low- and moderate-income borrowers.

While time is short — Congress returns next week for a short, post-election session — Freddie’s moves concerned HUD enough to prompt Assistant Secretary William Apgar to send a letter of opposition to a key lawmaker this week.

Freddie is asking lawmakers to expand an incentive HUD granted in its Oct. 31 final rule on the affordable housing goals. On loans it buys for multifamily properties in very low-, low-, and moderate-income areas, Freddie is allowed to multiply each unit over 50 by 1.2. For example, if Freddie buys a loan for an apartment building with 55 units, the government-sponsored entity earns credit for 66 low-income loans.

Freddie is asking Congress to increase that multiplier to 1.35 and apply it to more loans. The affordable housing goals apply to loans Freddie buys in very-low-income areas, low- and moderate-income areas, and what HUD calls “underserved” areas, such as inner cities. Freddie wants the extra credit applied to loans it makes in these underserved communities.

In 1999, Congress told HUD to give Freddie the incentive as a “temporary adjustment” to soften its reentry into multifamily lending, which it abandoned in the early 1990s.

Mitchell Delk, Freddie Mac’s senior vice president of government relations, said this was intended to address a fundamental disadvantage in the size and character of Freddie’s multifamily portfolio.

Fannie’s portfolio is larger and more seasoned than Freddie’s. Fannie holds roughly $50 billion in multifamily loans where Freddie has $10 billion to $15 billion, according to Mr. Delk. Freddie is at a disadvantage, he argued, because a significant part of meeting the multifamily affordable housing goals depends on refinancings of existing multifamily loans.

By Freddie’s estimates, it would take a multiplier of 1.35 to account for this disparity, Mr. Delk said. “It’s almost like we’re racing to the top floor of the apartment building and they’re [HUD] saying we should start two floors below Fannie.”

Mr. Delk also said HUD should expand the incentive to loans in underserved areas.

But HUD objects.

Mr. Apgar, in a Nov. 30 letter to House Banking Committee Chairman Jim Leach, said the final affordable housing goals are fair. Freddie should not be allowed to “overturn a carefully considered, well-documented, and complex regulatory decision made with the benefit of full and open public comment and deliberation,” Mr. Apgar told the Iowa Republican.

Mr. Apgar noted that among the public comments filed on the rule, Freddie’s was the only one to support increasing and expanding the multiplier.

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