Real Estate Law · August 25, 2026 · 7 min read
Federal regulators made a quiet but significant move this week that affects how lenders can structure certain fair-lending and homebuyer assistance programs.
On August 25, 2026, several federal agencies rescinded Biden-era guidance on Special Purpose Credit Programs (SPCPs). The interagency notice tells lenders not to rely on the 2022 SPCP statement that had clarified how financial institutions could design credit programs aimed at historically underserved groups.
If your eyes just glazed over, I get it. Let me translate what this actually means for buyers and sellers in Maryland, DC, Pennsylvania, and Delaware.
SPCPs have been part of federal fair-lending law since the Equal Credit Opportunity Act was passed in 1974. They allow lenders to create programs that meet the special social needs of economically disadvantaged groups, as long as those programs don't discriminate against other applicants.
In plain English: a bank can offer a first-time homebuyer program with better rates for buyers in historically redlined neighborhoods. A credit union can create a down-payment assistance product specifically for minority borrowers who've been locked out of homeownership. As long as it's designed to correct past discrimination or meet a documented need, it's legal.
The programs have always been legal. What changed in 2022 was that the federal banking agencies—the Federal Reserve, FDIC, OCC, NCUA, CFPB, and FTC—issued joint guidance that gave lenders clearer instructions on how to design and implement SPCPs without running afoul of fair-lending rules.
That 2022 guidance encouraged lenders to be more creative. It said you could target programs based on race, national origin, sex, and other protected classes if you could document the need and design the program carefully.
Now that guidance is gone.
The interagency notice doesn't ban SPCPs. The underlying law—ECOA and Regulation B—still permits them. What the notice does is tell lenders, "Don't rely on that 2022 guidance anymore when you're designing programs."
In practice, that makes lenders nervous.
When I taught high school, if I gave my students detailed instructions on how to format a research paper and then rescinded those instructions two weeks before the due date, you can imagine the confusion. Some kids would forge ahead with confidence. Most would play it safe and do the bare minimum.
That's what we're seeing now in lending. Without clear regulatory guidance, many lenders will pull back on SPCPs or design much narrower programs to avoid legal risk.
Maryland has a lot of down-payment assistance and first-time buyer programs, many of which are targeted to specific populations or neighborhoods. The Maryland Department of Housing and Community Development runs programs like the Maryland Mortgage Program, which offers down-payment and closing cost help.
Some of those state programs won't be affected—they're state-run, not bank-run, and states have their own fair-lending frameworks. But many local and private lenders in Baltimore County, Harford County, Montgomery County, and across the region had started designing SPCPs in the wake of that 2022 guidance.
A lender in Baltimore City, for example, might have been working on a renovation loan product aimed at Black homebuyers in neighborhoods that were historically redlined. With the federal guidance now rescinded, that lender's legal team might pump the brakes.
What does that mean for you?
If you're a buyer in Prince George's County or Anne Arundel County who was counting on a targeted assistance program, it might disappear or get redesigned in a less helpful way. If you're in York or Lancaster County, Pennsylvania, same story. Lenders are going to be more cautious.
I'm not saying these programs will vanish overnight. I am saying the momentum has shifted.
The good news: general down-payment assistance programs that don't target protected classes aren't affected. If a program is open to all first-time buyers regardless of race, sex, or national origin, it's not an SPCP and this guidance change doesn't touch it.
The Maryland SmartBuy program, for example, helps first-time buyers pay off student debt while purchasing a home. It's not targeted to a specific group, so it's fine.
But if you were working with a lender on a niche program designed to help a specific community, expect delays or changes.
If you're a buyer in Maryland, DC, Pennsylvania, or Delaware and you're exploring assistance programs, here's what to do:
Ask your lender directly. Don't assume the program you heard about six months ago is still available. Lenders are reassessing their offerings right now.
Look at state and local programs first. State housing finance agencies are less affected by federal regulatory whiplash. The DC Housing Finance Agency, Pennsylvania Housing Finance Agency, and Delaware State Housing Authority all run programs that aren't going anywhere.
Document your search. If you're trying to use a special program and it gets pulled, keep records. Fair-lending law still exists, and if you believe you've been treated unfairly, you have recourse.
Don't wait. If you're pre-approved for a program right now, move. Lenders are not going to get more generous in the near term.
For sellers: this doesn't directly affect you, but it does affect your buyer pool. If fewer buyers qualify for targeted assistance, that's fewer qualified buyers in historically underserved neighborhoods. If you're selling in East Baltimore, Anacostia, or certain parts of Wilmington, this could mean a longer time on market.
I listed a rowhouse in Baltimore City last spring where the buyer used a targeted SPCP from a local credit union. That program is under review now. The next seller in that neighborhood might not have the same luck.
Mortgage rates, by the way, are sitting at 6.65% as of August 20, 2026, according to Freddie Mac's latest survey. That's actually down a bit from the 6.92% we saw last week, which is good news. But rates are only part of the affordability equation.
If you can't access down-payment help because the program you were counting on got pulled, a lower rate doesn't solve your problem.
And yes, I know this feels like whiplash. Federal policy on fair lending, like so many things in real estate, swings back and forth depending on who's in charge. The underlying law hasn't changed. But how agencies interpret and enforce that law changes all the time, and lenders react accordingly.
As someone who spent two decades in education before I got into real estate, I'll tell you what I used to tell my students: focus on what you can control. You can't control federal regulatory guidance. You can control your credit score, your down payment, your choice of lender, and how quickly you move when you find the right program.
If you're selling in a neighborhood that's been historically underserved or where buyers often rely on assistance programs, talk to your Realtor about pricing strategy. You may need to price more competitively to attract buyers who no longer have access to the same programs.
I'm not saying take a lowball offer. I'm saying be realistic about your buyer pool and don't assume the market from six months ago is the market today.
If you're selling in Harford County or Cecil County, where buyers are often relocating from higher-cost areas and have more cash, this change probably won't touch you. But if you're in Baltimore City or parts of Prince George's County, it's worth a conversation.
You can always reach out to me if you want to talk through your specific situation.
This is general information, not legal advice—for your specific situation, please consult a licensed real estate attorney.
If you're working with a lender and they mention SPCPs or changes to assistance programs, ask them to explain it in writing. Get clarity on what's available, what's not, and what might change before closing. The last thing you want is to be under contract and find out your assistance program evaporated.
And if you're a seller wondering how this affects your listing strategy, let's talk. I work with buyers and sellers across Maryland, DC, Pennsylvania, and Delaware, and I've seen how policy changes ripple through local markets. Sometimes the ripples are small. Sometimes they're not.
The good news? We've been through worse. Rates were over 7% earlier this year. Inventory is still tight in many markets, which means well-priced homes are still moving. And there are still plenty of ways for buyers to get help—you just have to know where to look.
If you're ready to start looking at homes for sale in Maryland or want to talk about what this all means for your specific county, I'm here. No jargon, no pressure, just clear answers and a path forward.
Katrina Kirton Sherrod, REALTOR® · Samson Properties · Licensed in MD, DC, PA & DE · 443-616-9770 · Katrina@kkstherealtor.com
“The problem with waiting for the perfect house is that someone imperfect already bought it.” — Anonymous open-house guest