Expanded Housing Choice (EHC)
Supporting a more equitable housing market across all geographies in the U.S. without source of income protections
Removing barriers that prevent renters from finding a stable, sustainable place to call home
Fannie Mae’s Expanded Housing Choice (EHC) initiative is designed to help increase the supply of affordable housing for very-low-income families. EHC is available nationwide in jurisdictions where there are no source of income protections for Housing Choice Voucher (HCV) renters. EHC provides a pricing incentive for property owners who accept Department of Housing and Urban Development (HUD) Housing Choice Vouchers as a source of income.
EHC provides greater access to available HCV eligible units, which could provide more voucher holders with secure housing. A property is eligible if it has a minimum of 40% of rental units with rents within the applicable HUD Fair Market Rent (FMR) or Small Area FMR at origination, adjusted per the applicable Public Housing Agency payment standard.
We are constantly working to create innovative solutions for promoting sustainable affordable housing and benefiting renters.
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Creating an Impact
EHC works in unison with HUD’s HCV program to create housing opportunities that benefit renters, communities, and housing providers. It’s a win for everyone.
Renters
Increased supply of units that accept HCVs.
Communities
Stronger communities through mixed income housing.
Housing Providers
Lower pricing through EHC and guaranteed rent payments through HCVs.
Benefits For Borrowers & Property Managers
- Lower pricing, flexible loan terms, certainty of execution
- Speed in processing and underwriting
- An expanded renter base
- Lower turnover and vacancy – HCV renters stay 7-8 years on average1
- A steady stream of rent payments backed by HUD
- Reduced turnover and vacancy expenses
- Supports socially responsible investing
Benefits for the Community
- Wider availability of rental units accepting HCVs
- More individuals and families with a stable, affordable place to call home.
- More opportunities for children, whose families move to lower poverty areas, to have healthier lifestyles and increased rates of college attendance
- Housing providers commit to accept HCVs for the duration of financing (typically up to 10 years)
Creating a More Equitable Housing Market
Fannie Mae's social impact initiatives, like Expanded Housing Choice, provide housing to those with the greatest need. Consider the numbers:
The shortage of affordable rental housing primarily impacts renters with extremely low incomes who face a shortage of 7.3 million affordable and available rental homes.2
55% of HCV renters successfully find a rental but success rates are declining as renters lose valuable time on unsuccessful searches.3
Many states and jurisdictions do not have source of income protections for HCV renters which means property owners are not required to accept HCVs
Borrowers that use EHC financing bring affordability to a wider range of renters in their communities.
Eligibility
- Existing, stabilized conventional properties.
- Property is in a jurisdiction without source of income protections for HCV renters or is in a jurisdiction with source of income protections that has enacted legislation to rescind protections within 24 months after the Mortgage Loan Origination Date.
- Mortgage Loan or underlying deed restrictions do not already require acceptance of HCVs as a condition of financing (e.g., LIHTC).
- Minimum of 40% of units within the applicable HUD Fair Market Rent (FMR) or Small Area FMR at origination, as adjusted per the applicable Public Housing Agency payment standard.
- Borrower must execute a Modification to Multifamily Loan and Security Agreement (Expanded Housing Choice) (Form 6273).
EHC Case Study
Featured resources for borrowers
Why Fannie Mae?
Fannie Mae offers expertise and certainty in complex transactions. With a delegated risk-sharing model, DUS leverages private capital, aligns interests through risk-sharing, and supports life-of-loan servicing.
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