As a cooperative, our goal is to partner with each of our shareholder financial institutions to create more borrowing flexibility and collateral value. Over the last few years, we’ve made significant investments to provide opportunities for shareholders to report new types of collateral and gain more value from the collateral they already report. Read more below to learn about a few of these key initiatives.
Municipal securities are one of our newest collateral opportunities. To pledge municipals, the securities must be delivered to an FHLBank Atlanta safekeeping account. Once transferred, eligible securities become part of a shareholder’s general collateral pool and can be pledged immediately as collateral for borrowings.
To be eligible, securities must meet certain requirements, including:
- Bond must be rated AAA or AA and have proceeds that were used for real estate purposes
- Each bond must have a documented real estate nexus factor
- FHLBank Atlanta will determine real estate nexus factor and the amount of eligible funds as a percentage of the bond
Four Loan Portfolios
We accept four key loan portfolios as collateral: residential 1-4 first family, home equity lines of credit/second mortgages, commercial real estate loans, and multifamily loans. Shareholders can maximize their collateral value and borrowing capacity by reporting loans from all four portfolios.
We have implemented numerous eligibility expansions over the past few years to help increase the potential lendable collateral value of reported mortgages. For example, we increased the eligible loan-to-value ratio for residential mortgages, expanded the types of special purpose property commercial loans that receive value, and expanded potential values for commercial and multifamily loans based on the amount of loan data that shareholders report.
Residential Available for Sale
Shareholders can also receive lendable collateral value on their pipelines of closed residential 1-4 first mortgages held for sale in the secondary market through the our Residential Available for Sale (RAFS) program. RAFS collateral can be used as a source of mortgage warehouse funding or for any other short- or long-term borrowing need. Our haircuts, market values, and funding rates are competitive in the market.
To learn more about these opportunities, call us at 1.800.536.9650.
Review the Bank’s Member Products and Services Guide for complete collateral requirements. The Federal Home Loan Bank of Atlanta is not a registered investment advisor. Nothing herein is an offer to sell or a solicitation of an offer to buy any securities or derivative products. You should consult your own legal, financial, and accounting advisors before entering into any transaction.