Affordable Housing Program Implementation Plan Summary of Changes

The following lists material changes for the 2025 AHP General Fund and Set-aside Programs. Please see a complete copy of the 2025 AHP Implementation Plan (IP) for all changes and detailed program requirements. FHLB will also cover these changes in the AHP trainings to be held in April 2025. 

General Updates to the Implementation Plan

• Removed all requirements that prohibit the inclusion of social services (e.g., contract rents, operating pro forma, etc.) in project budgets
• Decreased the maximum interest rate on first mortgages to 9.875 percent
• Clarified that site control must be established through the date of AHP award
• Clarified that the Sponsor must have an “Ownership interest” in the project’s property at the time of AHP application to meet threshold requirements, not an “Eligible Ownership interest”, which merits points in the scoring system
• Established AHP application opening date as May 7, 2025, and the closing date as July 7, 2025
• Maximum subsidy per Member increased from $9,000,000 to $10,000,000
• Inserted language to clarify that the AHP income targeting cannot accommodate use of the tax credit program’s income averaging
• Changed the Energy Star requirements for “Manufactured housing” to state that manufactured homes must be new construction and/or Energy Star certified

Scoring Criteria

• Member Financial Participation – A number of changes were made to this scoring category. Please consult the IP for more detail
• Outside Funding Commitments – Replaced this scoring category with the Opportunity for Disadvantaged Areas scoring category
• AHP Leverage - Removed this scoring category
• High Volume Projects – New scoring category
• Project Sponsorship – Increased two points to award to projects for which the Sponsor provides the first mortgage permanent loan(s) to project borrowers
• Community Stability – A number of changes were made to this scoring category. Please consult the IP for more detail

Compliance Requirements

• Removed the suggestion that FHLB will collect a project’s management agreement as part of its disbursement process
• Reduced the percentage of tenant files that FHLB will sample to ten percent of the project’s units for initial and long-term compliance audits

Definitions

• Updated “Affordable” definition to 33 percent of a household’s gross monthly income for households buying a home using a USDA loan
• Added a definition of “Climate Resilience”
• Updated “Contract rent” to allow “Social services” and utilities
• Added a definition of “Costs – hard construction”
• Added a definition of “Costs – soft”
• Included in the definition of “Donated” that FHLB does not consider a property to be donated unless it is from an unrelated party
• Removed the language in the “Social services” definition that implies that only Sponsors can provide these services

Project Feasibility Guidelines

• Increased the total project cost limit per bed from $80,000 to $85,000
• Specified that the rates on predevelopment loans in AHP projects are subject to the limit established for construction loans
• Reduced the adjuster on loan cost assessments from 500 to 400 basis points over FHLB rates for bridge loans
• Removed the Operating costs per unit maximum, Management fees, Debt coverage ratio maximum and Expense to income ratio feasibility parameters from the assessment of AHP applications and disbursements

Requirements for the Welcome Home Program

• Maximum grant per household of $20,000 for 2025
• Decreased the maximum interest rate on first mortgages to 9.875 percent
• Established March 3, 2025, as the opening date 

Please contact the Housing and Community Investment Department at 888-345-2246 with any questions.