source:
  type: guide
  id: fnma-sel-b5-5.3-01
  authority: Fannie Mae Selling Guide B5-5.3-01 — Shared Equity Overview
  description: Fannie Mae Selling Guide B5-5.3-01 — Shared Equity Overview.
  coverage_tier: operative
obligations:
- id: fnma-sel-b5-5.3-01-full
  canonical_id: fnma-sel-b5-5.3-01-full
  section: Fannie Mae Selling Guide B5-5.3-01 — Shared Equity Overview
  type: do
  tags:
  - regulator-direct
  - fnma
  - selling-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Fannie Mae Selling Guide B5-5.3-01 — Shared Equity Overview
    source_class: fnma-guide
    source_url: https://singlefamily.fanniemae.com/media/document/pdf/selling-guide
    snapshot_id: 5f7b8b79da595d76
    fetched_at: '2026-05-25T14:09:57Z'
    content_hash: sha256:98cf85a02861bbe84914a0e339b327c8fc131869a8a573882007bbeea60c5701
    paragraph_quote: 'B5-5.3-01, Shared Equity Overview (02/05/2025) Introduction
      This topic contains information on shared equity transactions, including: Overview
      Community Land Trusts Income and Resale Price Restrictions Overview Shared equity
      programs, sometimes called "below-market programs," create long-term aﬀordability
      by both limiting income eligibility and imposing a maximum resale price (or
      a resale formula applies that limits the homeowner''s proceeds upon resale).
      Shared equity providers typically make a one-time investment in a property by
      subsidizing the sales price for the ﬁrst buyer and recycling the subsidy for
      subsequent, income- eligible buyers of the same property. In exchange for purchasing
      a home below market value, the homeowners agree to restrictions on the future
      sale of the home, including limitations on sales price or proceeds that maintain
      aﬀordability for the next buyer. Loans originated in connection with the following
      shared equity programs are eligible for purchase by Fannie Mae: community land
      trusts, income and resale price restrictions, limited or shared equity co-ops.
      It is against Fannie Mae policy to compel borrowers to participate in arbitration
      to resolve disputes regarding their mortgage loan. See B8-3-02, Special Note
      Provisions and Language Requirements. Similarly, Fannie Mae will not purchase
      shared equity loans where the borrower is required to submit to arbitration
      to resolve disputes with the shared equity program unless the mandatory arbitration
      provision provides, or is amended to provide, that, in the event of a transfer
      or sale of the related mortgage or an interest in the related mortgage loan
      to Fannie Mae, the mandatory arbitration clause immediately and automatically
      becomes null and void and cannot be reinstated. This does not prohibit the borrower
      and the shared equity program from engaging voluntarily in arbitration, mediation,
      or other alternative methods of dispute resolution. Note: This topic focuses
      on community land trusts and income and resale price restrictions. For information
      on limited or shared equity co-ops, see B4-2.1-03, Ineligible Projects. Community
      Land Trusts Community land trusts preserve long-term aﬀordable housing by purchasing
      homes in their communities, then selling the homes to income-eligible buyers
      while retaining ownership of the land. The homeowners lease the land from the
      community land trust using a long-term ground lease with aﬀordable monthly ground
      rents. The ground lease includes provisions that preserve long-term aﬀordability,
      including restrictions on the future sales Published May 6, 2026 781 price of
      the home and income levels of future homeowners. Income and Resale Price Restrictions
      Resale restrictions are a right in perpetuity or for a certain number of years
      and are binding on current and future property owners. They remain in eﬀect
      until they are formally removed or modiﬁed, or terminate in accordance with
      their terms, such as at a foreclosure sale or upon acceptance of a deed-in-lieu.
      Income and resale price restrictions help maintain long-term aﬀordability for
      shared equity programs. These programs include both an income and a maximum
      resale price restriction that eﬀectively subsidize the sales prices for income-eligible
      buyers, and in exchange for the subsidy, the buyers agree to resale restrictions
      that limit the future sales price of the home to preserve aﬀordability for future
      income-eligible buyers. For information on other types of resale restrictions,
      see B5-5.2-01, Loans With Resale Restrictions: General Information and B5-5.2-02,
      Loans with Resale Restrictions: Eligibility, Collateral and Delivery Requirements.
      Recent Related Announcements The table below provides references to recently
      issued Announcements that are related to this topic. Announcements Issue Date
      Announcement SEL-2025-01 February 05, 2025 Announcement SEL-2023-11 December
      13, 2023 Announcement SEL-2023-04 May 03, 2023'
  judgment: false
