MPF Xtra: Ineligibility of Loans Secured by Investment Properties and Second Homes

  • June 22, 2021

On June 21, 2021, the Mortgage Partnership Finance® (MPF®) program published an announcement in regards to the temporary ineligibility of investment properties and second homes under the MPF Xtra® product, effective July 1, 2021.

  • Investment property and second home delivery commitments (DCs) dated prior to July 1, 2021 are eligible for funding; extensions of these DCs after June 30, 2021 will not be allowed.
  • Effective July 1, 2021, Participating Financial Institutions (PFIs) will no longer be able to execute new MPF Xtra Investment Property DCs.
  • Funding requests for DCs containing second homes and investment properties executed on or after July 1, 2021 will be rejected and the PFI may be subject to a pair-off fee.

Please contact the MPF Service Center at mpf-help@fhlbc.com or 877.345.2673 to begin funding your MPF Xtra Investment Property and Second Home DCs executed prior to July 1, 2021.

We have the following suggestions to help your institution fund investment properties and second homes after July 1, 2021:

  • Convert fixed-rate investment property or second home loans to adjustable-rate and hold on balance sheet.
  • Keep fixed-rate investment property or second home loans on balance sheet, funded with advances from the Federal Home Loan Bank of Chicago (FHLBank Chicago).
  • Sell eligible second home loans to MPF Traditional Master Commitments (MCs).
  • Sell investment property loans to another investor.
  • Sell investment property loans to another FHLBank Chicago member. If your institution is interested in buying another PFI’s investment property loans, please reach out to your Sales Director.

MPF Traditional

Currently, second homes are eligible under the MPF Traditional product while investment properties remain ineligible for delivery. We strongly encourage PFIs to deliver second home loans into this product. If your institution does not have an open MPF Traditional MC, please reach out to your Sales Director to obtain one.

Join a Webinar to Learn More and Ask Questions

On Thursday, June 24, 2021 at 3 p.m., we are hosting a special Weekly Market Update webinar where we will discuss these changes and answer questions. If you’re unable to attend Thursday afternoon, please join us Friday, June 25, 2021 at 10:30 am for an MPF Xtra Investment Properties and Second Homes Q&A Session.

We're Here to Help

For MPF product and operational support questions, please contact the MPF Sales Support Team at mpfsales@fhlbc.com.

 

Contact Us

Please direct all media inquiries to:

Casey Reidy 
Senior Manager, Communications 
creidy@fhlbc.com
312.565.5291