Racial Equity Initiatives

Empowering Black Homeownership Matching Grants

In 2022, the Bank launched this pilot matching grant program to address historical and systemic barriers to homeownership disproportionately experienced by generations of Black households in purchasing homes and making mortgage payments. The Empowering Black Homeownership program matches donations made by our member financial institution to fund and expand the operational capacity of HUD-approved housing counseling agencies for pre- and post-purchase homeownership counseling to aspiring and at-risk homeowners in communities of color. 

In 2023, the Bank expanded the Empowering Black Homeownership program by doubling its commitment to a $2 million allocation for matching grants up to $125,000 per participating member financial institutions. Member financial institutions wishing to participate in the 2024 Empowering Black Homeownership program can complete and submit a Certification and Disbursement Request form.

Homeownership Solutions Summits and "Closing the Racial Equity Gap" Report

As part of a continuum of FHLBank San Francisco programs and initiatives to advance racial equity in homeownership and address housing affordability and economic opportunity across the Bank’s three-state district of California, Arizona, and Nevada, the Bank held a series of Homeownership Solutions Summits in 2022 and 2023.

In convening these Summits, the Bank’s goal was to bring disparate, siloed stakeholders and practitioners together to share ideas, explore best practices, and develop evidence-based solutions to boost both the supply of affordable housing and access to equitable mortgage financing. These sessions provided a forum to understand what is happening in local communities and to identify tangible actions that can be taken to address racial inequity impacting the housing finance market. Stakeholders from across the housing and mortgage finance industry gathered with community and political leaders to share ideas, explore best practices, and coordinate public and private collaborations that can better address the urgent demand for affordable housing and homeownership opportunities.

In October 2023, FHLBank San Francisco released a package of recommendations for updating the housing ecosystem to close the racial homeownership and wealth gaps. "Closing the Racial Equity Gap: A Call to Action" is an historic first for a Federal Home Loan Bank. It directly calls out entrenched systemic failings and offers novel yet constructive ideas that have the potential to break down structural barriers that historically have disadvantaged people of color.

Within the report we also collected links to third-party external resources that offer or provide job training programs, financial literacy education, and housing assistance, including downpayment assistance resources that can complement the Bank’s WISH First-Time Homebuyer grant program.

Racial Equity Accelerator for Homeownership

We launched our Racial Equity Accelerator collaboration with the Urban Institute as a call-to-action for the industry to rewrite the U.S. home financing process, critically evaluate the systemic barriers that continue to limit people of color from achieving homeownership and implement tangible solutions that enable and ensure racial equity in homeownership and wealth-building.

Through this $1.5 million, two-year collaboration with the Urban Institute, FHLBank San Francisco is proud to add relevant data and insights to the search for scalable solutions to address the decline in Black homeownership rates, which has further widened the racial wealth gap over the past six decades and moved the U.S. farther away from equitable access to homeownership in local communities.

With this evidence-based research initiative, it was critically important to widen the lens, to see how systemic and structural barriers to homeownership for people of color might be addressed. To that end, the Racial Equity Accelerator for Homeownership has focused on four areas that ripe for innovations that would help advance equity: 

The first paper explores how to bring more information into the underwriting process that will result in sustainable loans where the borrower has the demonstrated ability to repay. Read Reducing the Black-White Homeownership Gap through Underwriting Innovations: The Potential Impact of Alternative Data in Mortgage Underwriting

The second paper addresses the burden of student loan debt that disproportionately affects people of color, given past barriers to wealth building. Read Student Loan Debt and Access to Homeownership for Borrowers of Color

The third paper is about finding solutions to short-term payment issues that lead to foreclosure. Read Using Mortgage Reserves to Advance Black Homeownership 

The fourth Accelerator paper focuses on the role of Artificial Intelligence, or AI, in mortgage lending, and how we can root out inherent biases in the AI data and algorithms used in mortgage finance. Read Harnessing AI for Equity in Mortgage Finance