§4502 Definitions

Summary

Defines common words used in the chapter so people know what they mean. Affiliate — an entity that controls, is controlled by, or is under common control with an enterprise, unless the Director says otherwise. Agency — the Federal Housing Finance Agency. Authorizing statutes — the three Acts that set up Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. Board — the Federal Housing Finance Oversight Board. Capital distribution — most dividends or other cash or in‑kind payments to owners, stock buybacks or related financing, and similar transactions the Director treats as capital distributions; buybacks to meet a qualified employee stock ownership plan under section 401 of title 26 are not counted. Compensation — any money or other thing of value paid for employment. Core capital — an enterprise’s common and certain preferred stock par value, paid‑in capital, and retained earnings, but not amounts investors can force the enterprise to pay to retire capital. Default — an official finding that leads to a conservator, receiver, limited‑life regulated entity, or legal custodian being appointed for a regulated entity. In danger of default — when the Agency thinks a regulated entity likely can’t pay its bills or will lose most of its capital and has no reasonable prospect of getting new capital. Director — the Director of the Federal Housing Finance Agency. Enterprise — Fannie Mae or Freddie Mac and their affiliates. Entity‑affiliated party — people and groups tied to a regulated entity, like directors, officers, employees, controlling shareholders, agents, shareholders, affiliates, consultants, joint venture partners, certain independent contractors who knowingly or recklessly cause serious harm, not‑for‑profits mainly funded by the entity, and the Office of Finance (membership alone in a Federal Home Loan Bank isn’t by itself participation). Executive officer — top leaders such as the chair, CEO, CFO, president, vice chair, executive vice presidents, and senior VPs who run main business units. Limited‑life regulated entity — an entity the Agency creates under law for a bank or enterprise in default or in danger of default. Low‑income — households with income up to 80 percent of area median income (with rental adjustments for family size). Median income — the unadjusted median family income for an area as published by the Director. Moderate‑income — income up to area median income (with rental adjustments). Mortgage purchases — mortgages bought for the enterprise’s portfolio or for securitization. Multifamily housing — buildings with more than 4 units. Office of Finance — the Office of Finance of the Federal Home Loan Bank System. Regulated entity — Fannie Mae, Freddie Mac, their affiliates, and any Federal Home Loan Bank. Single family housing — 1 to 4 unit residences. State — the U.S. states, DC, Puerto Rico, the Northern Mariana Islands, Guam, the Virgin Islands, American Samoa, the former Trust Territory of the Pacific Islands, and other U.S. territories or possessions. Total capital — core capital plus a general allowance for foreclosure losses (including portfolio mortgage losses, nonreimbursable foreclosure costs on government claims, and estimated foreclosure losses on mortgage‑backed securities, but not reserves against specific assets) and any other loss‑absorbing amounts the Director allows. Very low‑income — income up to 50 percent of area median income (for certain sections, means income over 30 percent but not greater than 50 percent of area median income). Violation — any act to cause, help, advise, or take part in a breach of a law or rule. Conforming mortgage — a conventional mortgage whose original principal does not exceed the legal dollar limit for the enterprise. Extremely low‑income — income up to 30 percent of area median income. Low‑income area — a census tract or block where median income is no more than 80 percent of the surrounding area’s median, and for certain rules includes families up to 100 percent of area median income in minority tracts and designated disaster areas. Minority census tract — a tract with at least 30 percent minority population and median family income below 100 percent of the area median. Shortage of standard rental units for extremely low‑income renters — the gap between (1) units with full plumbing and kitchens renting at 30 percent or less of 30 percent of adjusted area median income that are occupied by or vacant for extremely low‑income renter households and (2) the number of extremely low‑income renter households (if units exceed households, there is no shortage). Shortage for very low‑income renters — the similar gap using rent at 30 percent or less of 50 percent of adjusted area median income and counting extremely low‑ and very low‑income renter households (again, if units exceed households, there is no shortage).