HUD considering climate change when underwriting loans: Massachusetts Homebuyers Homeownwers

 The U.S. Department of Housing and Urban Development (HUD) recently announced a plan that will implement new policies to combat global warming, according to a press release. Provisions include factoring in climate change when underwriting loans, incentivizing the construction of energy efficient housing and updating grant guidelines that provide state funding to rebuild infrastructure after a major natural disaster. The move is part of a broader strategy led by the White House and 20 other federal agencies more than a month after Hurricane Ida left 95 people dead as it flooded Louisiana, New York and New Jersey. “HUD is taking an agency-wide approach to prioritize climate resilience because we cannot put America on the path to building a stronger and more sustainable housing infrastructure without addressing the impacts of climate change,” said Marcia Fudge, HUD Secretary.

 According to HUD, the agency is working with the U.S. Department of Veterans Affairs and the U.S. Department of Agriculture to integrate climate-related financial risk into writing standards and loan terms and conditions.
HUD’s mortgage financing programs, primarily its insurance programs, enable billions of dollars to fund the purchase, refinancing, construction and rehabilitation of single-family homes and multifamily housing, assisted housing and health care facilities.

 Many low income or first-time homeowners rely on federal financing programs. Federal agencies don’t currently consider climate risk issues, such as flooding, wildfires or subsidence when underwriting loans. While the details are still forthcoming, factoring in climate risk could affect future policies as early as 18 months from now. HUD hopes to incentivize developers through grants and tax credits to build resilient and efficient infrastructure. As part of the new plan, the agency is transforming how it disperses aid to states through community development grants after natural disasters. In addition, HUD is prioritizing funding for rebuilding efforts in communities of color that increase flood resilience and minimize the adverse effects to floodplains and wetlands.

The post HUD now considering climate change when underwriting loans appeared first on Boston Agent Magazine.

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