Interim Construction and Land Aquisition Loan Program
Highlights:
The Corporation has new policies for the Interim Construction and Land Acquisition Loan Program that were approved by our Board in December. Here is a link to the new policies:
Introduction:
The Interim Construction and Land Acquisition Loan Program supports the Corporation's mission to promote equal access to safe, decent, and affordable housing with an emphasis on serving rural and underserved markets. The program provides initial short-term financing for site acquisition and interim construction to non-profit and for-profit developers for the purpose of increasing and preserving the stock of affordable housing for homeownership throughout the state of Texas .
The Corporation considers proposals for development (“Development”) that involve the sale of housing units to unrelated third party households. This includes Developments involving, but not limited to, single-family or multifamily residential structures, condominiums, limited equity co-operatives, subdivisions, infill construction, new construction and rehabilitation. Loan proceeds may be used for predevelopment costs, acquisition of real property, on-site infrastructure, and the construction or rehabilitation of housing units.
The Corporation accepts applications to the Program on an ongoing basis and only when there are available sources of funds for the Program. In the event that there are not sufficient funds available for a Development, the Corporation shall return any application or commitment fees submitted by a borrower.
The Corporation requires applications be submitted at least 28 business days prior to any recommendations to the Board for award. Applicants are encouraged to communicate with staff as they assemble this application. Please contact David Danenfelzer , Manager of Multifamily Programs, by phone at: 512.477.3555 ext. 403, or by email at: ddanenfelzer@tsahc.org
| Term of Loan: |
The standard length of loan agreements, (the “Term”) of all loans is 18 months. Borrowers may be granted one 6 month extension to the maturity date, if benchmarks are met in the development process. |
| Interest Rate: |
Interest rates for the Program shall be set at a fixed rate of interest based on the cost of funds available to the Corporation. The minimum interest rate for the program shall be 4.75% annually. Loans that receive an extension to the maturity date shall have an increase of .25% to the interest rate. |
| Affordability: |
The program targets housing developments where at least 50% of the homes will be sold to households earning 80% or less than the AMFI. The Corporation will require a minimum number of lots or homes be sold to qualified low-income households based on the percentage of funds provided and other factors. All housing constructed and sold to qualified and non-qualified households must be financed with fixed rate loans. Borrower's that do not fulfill the affordability guarantees will be subject to additional fees, fines or payments as determined by the loan agreement. |
| Eligible Borrowers: |
Any reputable and experienced entities engaged in affordable housing development, including non-profit or for-profit developers, partnerships, limited liability companies, municipalities, housing authorities, or other business entities as approved by the Board. |
| Experience: |
All Applicants will be required to submit proof of past residential construction and subdivision development experience. The Corporation will determine on a case by case basis the level of appropriate experience needed by Applicants and their partners. |
| Payment: |
Payments of principal and interest shall be made from the net sales proceeds (i.e., those proceeds remaining after the payment of normal and customary closing costs) received from the sale of lots, or homes. Interest shall be calculated on the principal balance of the loan outstanding from time to time and based upon the actual number of days elapsed divided by 360. |
For more information and to discuss lending opportunities please contact David Danenfelzer at 512-477-3555 (ext. 403) or at: ddanenfelzer@tsahc.org
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