Supporting Upgraded Property Projects and Lending for Yards (SUPPLY) Act

Financing for Construction: The Secretary establishes a program to insure second liens used for financing the construction of accessory dwelling units (Section 2, subsection a).

Increased Loan Limits via Rental Income: The Secretary may increase the maximum loan amount based on 50 percent of any projected annual rental income expected from the accessory dwelling unit (Section 2, subsection b, paragraph 2).

Access to Securitization: The Director of the Federal Housing Finance Agency allows the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation to purchase and securitize these insured loans (Section 3, subsection a).

Insurance Costs: Borrowers will be subject to a premium charge for the insurance, which may not exceed 1 percent of the principal amount insured each year (Section 2, subsection d).

Loan Limitations: The Secretary may restrict the amount of the second lien to the lesser of 30 percent of the amount determined under section 203(b)(2)(A) for a one-unit residence, or 100 percent of the projected property value after construction when combined with other existing liens (Section 2, subsection b, paragraph 1).

Market Risk Restrictions: The Director of the Federal Housing Finance Agency has the authority to prohibit the purchase and securitization of these loans if market pressures pose an excessive and unmitigable risk to the lending market (Section 3, subsection b, paragraph 1).