Freddie Mac Green MBS Making an Impact for Homeowners and the Environment
Since its inception, Freddie Mac has been a mission-oriented company – providing liquidity, stability, and affordability to the U.S. housing market.
Our Expansive Mission Helps Make Homeownership More Affordable
Today, our mission extends to promoting environmentally sustainable single-family housing to help reduce climate-related risks and increase affordability. Our sustainability focus strengthens our commitment to our mission and helps us drive long-term value for our stakeholders while making a difference in our communities. We started this work in 2019, with the introduction of our Single-Family GreenCHOICE Mortgages® offering solution, which allows borrowers to use refinance proceeds for energy efficient home improvements. Improving the energy efficiency of homes provides savings to our borrowers, may increase the value of homes, and positively impacts our environment.
Following the success of our Multifamily Impact Bonds and to attract capital to help support our GreenCHOICE Mortgages offering, we securitized GreenCHOICE Mortgages and issued our first Single-Family Green Mortgage-Backed Security (Green MBS) to investors in April of 2021.
Through our Green MBS, we’re financing energy-efficient homes and home improvements to help more families achieve and maintain affordable homeownership while reducing the housing sector’s environmental impact.
We Are Delivering Results for Homeowners and the Environment
Recently, we released our first Single-Family Green MBS Impact Report covering the inaugural year of Green MBS issuance. Each one of the loans backing our 2021 issuance is secured by a home where solar panels produce renewable energy, reduce greenhouse gas emissions, and decrease the reliance on energy sources that may have a much more harmful impact on the environment.
The report outlines the environmental benefits provided by $617 million of 2021 Green MBS issuance. These benefits included netting enough energy to power 1,877 homes and avoiding greenhouse gas emissions the equivalent of taking 2,433 cars off the road for a year. Homeowners benefitted as well, saving an average of $1,027 in annual utility costs for each the nearly 2,500 GreenCHOICE Mortgage refinance loans included in a 2021 Freddie Mac Single-Family Green MBS.
Now We Are Doing Even More
Earlier this year, we expanded the Green MBS offering through the launch of our Single-Family Green Bond Framework, which broadened the criteria of eligible mortgages available for securitization. Mortgages backed by newly constructed homes with a renewable energy source and some mortgages backed by newly constructed homes with a Home Energy Rating System (HERS) score now meet Freddie Mac’s requirements for our Green MBS program. This expansion of eligible energy efficient mortgages will help encourage green construction and energy efficiency home improvements.
The expansion of the program is already contributing to the Green MBS program’s growth. As of October 1, 2022, we have sold Single-Family Green MBS totaling nearly $1.9 billion, and we do not intend to stop there. We will continue to innovate in this space and foster a market for these loans. We welcome you to join us in helping to create a better environment for all.
See our ESG page of our website, for a list of our ESG Reports and Disclosures.
©2023 by Freddie Mac.
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