Perspectives

Celebrating the End of the Temporary Credit and Liquidity Program

Jeffery Hayward
EVP, Multifamily
Mortgage Business

Last week, the Temporary Credit and Liquidity Program ended, marking an important point in time for Fannie Mae and the country as we move farther away from the housing crisis. The Temporary Credit and Liquidity Program was launched in 2009 by the U.S. Treasury to provide liquidity support for variable rate demand bonds issued by state and local housing finance agencies. Through this initiative, Fannie Mae provided additional support to HFAs to ensure they maintained their financial condition, which enabled them to continue their critical mission.

Why were the HFAs so important to the U.S. Treasury and the country? They were important because they were one of the largest sources of affordable lending for working families to buy homes and to build and preserve affordable rental housing in every state and in many localities. Their importance persists today.

I had the privilege of being responsible for the Fannie Mae team tasked with driving and developing ideas to solve the liquidity challenge the HFAs were experiencing. Through the team’s tireless work and dedication, along with the other working group members, Treasury, Freddie Mac, and the HFAs themselves, we were able to conceive and launch a solution in 70 days. The initiative was constructed to be temporary in nature, available until the HFAs could return to their normal market executions. There was no manual or set of instructions for how we should support the HFAs and provide liquidity. We just figured it out.

Through this program, Fannie Mae and Freddie Mac provided replacement credit and liquidity facilities to HFAs, which enabled them to keep their bonds outstanding and reduce the cost of maintaining existing financing facilities. As was intended, the Temporary Credit and Liquidity Program ended, having helped to successfully secure $8 billion of HFA bonds during the housing crisis and, as a result, stabilize the U.S. housing market. I personally found this project very rewarding because I saw first-hand how the Fannie Mae team came together, rallied behind an important issue and quickly developed an effective solution. Through this team’s leadership, we ultimately helped many hardworking American families and met our mission to provide liquidity in every economic cycle.

I am proud of our continued work to support access to affordable housing, proud of the Fannie Mae team that worked so hard to find ways to support the HFAs for the benefit of working families, and proud to bring this program to a close.

Jeffery Hayward
Executive Vice President - Multifamily


July 30, 2015