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Member Bulletin

  • January 26, 2024
  • Bulletin No: B2024-02

Announcing the New Community Development Special Finance Program Pilot

The Community Development Special Finance Program (CDSFP) pilot was created by the Federal Home Loan Bank of Dallas (Bank) to increase member support for single-family housing lending activity. Through the pilot, the Bank will provide a more favorable haircut to members who pledge single-family residential loans to certain income-qualified borrowers.

The pilot will support FHLB Dallas members, with a reduced collateral haircut (12 percent) for qualifying mortgage loans to certain income qualified borrowers (CDSFP Income Qualified Single-Family Residential loans or “CDSFP Qualified Loans”). The maximum amount of CDSFP Qualified Loans to be pledged under the Pilot Program is $200 million (after pricing and haircuts). 

The pilot begins March 1, 2024. It will remain open for two years or until $200 million in qualifying collateral is pledged, whichever occurs first.

During the program’s initial six months, $150 million of the total collateral capacity will be dedicated to CDFIs and $50 million will be available to other members. After six months, the remaining capacity under the $200 million program cap will be available to all members.

To receive the reduced haircut, the loans must meet the following requirements:
 

  • Borrower income equal to or below 115 percent of the area median income at the time of origination
    • Certified by the member
  • Compliance with all loan collateral eligibility and documentation requirements specified in Bank policies
Additional program features:
 
  • Total collateral pledged by a member through this program cannot exceed the lesser of $20 million or 35 percent of the member’s total assets
  • Participating members must maintain an internal Bank credit rating of D or better
 
Please review these FAQs or contact Collateral Services at 800.541.0597 with questions. Additional details about the pilot program will be made available ahead of the official launch on March 1, 2024. The Bank describes all pilot programs on its website. Check fhlb.com/pilots for information on other active pilot programs.


Sincerely,


Sanjay K. Bhasin
President and Chief Executive Officer