The Federal Home Loan Bank of Cincinnati
The HomeProtect Program (HPP) is a $250 million set-aside of the Community Investment
Program to encourage member financial institutions to provide first mortgage refinancing to
homeowners with incomes at or below 115 percent of HUD area median incomes who are at
risk of delinquency or default. The HomeProtect Program provides a discount off regular
advance programs, providing funds at the FHLBank’s cost of funds.
LIMITATIONS AND REQUIREMENTS
Funds are targeted to refinance first mortgages for primary residences in Kentucky, Ohio, or
Tennessee, but may also be used to refinance first mortgages for primary residences in any
other state in which a member does business. Funds may be used for mortgages in amounts
up to Freddie Mac conforming loan limits.
The rate of interest, points, fees, and all other charges must be reasonable and customary; the
first mortgage loan must comply with applicable federal, state and local anti-predatory
lending laws, regulations and orders designed to prevent or regulate abusive and deceptive
lending practices and loan terms; the first mortgage loan closing may not include single-
premium credit life insurance; and the first mortgage loan may not exceed the annual
percentage rate, or points and fees thresholds of the Home Ownership and Equity Protection
Act of 1994 and its implementing regulations (Federal Reserve Board Regulation Z).
Borrowers may not take any “cash out” of the refinancing, but may only use the funds to pay
off the first mortgage principal outstanding, plus any delinquent amounts owed, including
fees, loan origination and processing fees.
Borrowers must complete a homebuyer counseling program provided by, or based on one
provided by, an organization recognized as experienced in homeowner counseling. The
counseling program must cover, at minimum, mortgage financing, credit-worthiness,
household budgeting, and home maintenance. Counseling may be provided by the member or
by some other party. A list of HUD-approved counseling agencies is posted at
HPP funds may be used with other mortgage or grant assistance programs, depending on the
requirements of those programs, but may not be used with other programs of the FHLBank
(such as the AHP, Welcome Home, or the American Dream Homeownership Challenge).
The FHLBank expects that funds will be used to provide first mortgages affordable to
borrowers at their fully-indexed rates.
HPP advances are made available to eligible financial institutions on a secured basis only and
are subject to the normal underwriting and collateral policies of the FHLBank.
The FHLBank has set aside $250 million for the HPP. HPP advances are available until June
30, 2009, on a first-come, first-served basis, subject to the availability of funds.
Funds are priced daily at the Bank's cost of funds and are generally processed within two
business days from receipt of application.
Funds must be drawn or the HPP rate locked within six months of approval.
ELIGIBLE ADVANCES TYPES
The FHLBank’s regular fixed-rate (one to 20 years) and mortgage based advances programs
(CMP, MMA, SPMMA and Balloon Payment) are eligible.
Member institutions may borrow HPP funds in an amount equal to the lesser of 2% of assets
or $50 million in HPP advances on an annual basis.
Member institutions applying for HPP advances should complete and submit an HPP
Application that describes the use of funds and which provides certain certifications. The
Application is submitted to Housing and Community Investment (HCI) which assigns the
HPP discount. After approval by HCI, the HPP funding becomes a regular credit transaction
that requires completion of an Advances Application Agreement submitted to the Credit
Department. Funds are disbursed into the member’s DDA account with the FHLBank.
INFORMATION AND TECHNICAL ASSISTANCE
For information or assistance, please contact:
Carol M. Peterson, Senior Vice President, or
W. Jeff Reynolds, Vice President
Housing and Community Investment
Federal Home Loan Bank of Cincinnati
(513) 852-7615 or toll-free (888) 345-2246
E-mail: firstname.lastname@example.org; email@example.com
Revised 7/20/2011 Expires 6/30/2008