Relief for Homeowners and Renters
We’re extending help to millions of homeowners and renters facing financial hardships as a result of COVID-19.
And just like that, we wrapped up the seventh year of the Small Balance Loan (SBL) program.
In 2021, we bounced back and are on pace to exceed 2020’s production levels by 15%. Despite the ups and downs that the pandemic brought us these last 22 months, we found ways to strategically grow.
Since inception, SB-Deal® securitizations have now surpassed $34 billion in total issuances, and as I reflect on what our Small Balance program has done over these lucky seven years, I can’t help but focus in on the number five, as it seems to be a reoccurring theme:
When the year started, we made a commitment that we weren’t going anywhere. Despite the Debt Service Reserve (DSR) requirements for a majority of the year, we funded almost 2,000 loans. And as our borrowers proved their savvy, the number of SBL loans in forbearance plummeted. Combine that with strong collections and occupancy levels, we were able to relinquish the DSR requirements this fall, even allowing SBL borrowers to have their reserve funds released sooner than expected.
SBL’s focus on naturally occurring affordable housing hasn’t wavered either. We’re proud that in 2021, over 75% was mission-driven business and nearly half the units were for residents making 60% or less of area median income.
As we turn the calendar, we are excited to see that FHFA expanded our 2022 definition of mission-driven business. With this comes new opportunities for our lenders and their borrowers, and the Affordability Test has been updated to once again include designations for cost-burdened and very cost-burdened markets.
Heading into 2022, we’ve all become stronger together. The pandemic shook up how we do business, but resilience has been the name of the game in SBL. It’s easy to do business when times are good, but we should all be proud of the program’s ability to bounce back through challenging times. Next year’s horizon is in sight – and we can’t wait to see what’s in store.
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