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The Loan Fund’s Expansion of its Lending Footprint



NeighborGood Partners is rolling out an expansion of an important new resource for self-help housing grantees throughout Region III to assist with securing, acquiring, and developing lots, land, and properties for their production programs.


In 2004, NeighborGood Partners became a Community Development Financial Institution (CDFI) certified by Treasury for community development lending in Delaware and the Eastern Shores of Maryland and Virginia, known as Delmarva.


WHAT IS A CDFI?

As a CDFI, we make loans primarily for the development of affordable housing and community facilities, as well as for other community and economic development projects. Affordable housing projects include both for-sale and rental housing. Examples of community facilities include charter schools, health centers, libraries, senior centers, Head Start and early childhood education facilities, and addiction recovery facilities. Since 2004, $178 million has been loaned for community projects that could not be made by traditional institutions directly.


Hear from Dave Callahan, Loan Fund Director



WHAT IS THE SELF-HELP HOUSING PROGRAM?

United States Department of Agriculture (USDA) Rural Development’s Mutual Self-Help Housing program consists of families working together to build their own homes. With the assistance of a skilled staff, an association of generally 4 to 10 families is formed. These families provide at least 65% of the labor necessary to build the homes. Self-Help Housing could also be a repair program where families purchase and repair their new home or repair a home they already own.


The sponsor organization receives a Section 523 Self-Help Housing Technical Assistance Grant from Rural Development to operate the self-help program. The nonprofit grantee takes on the responsibilities of training the families in construction as well as homeownership skills, keeping the families' loan records, ordering the construction materials, choosing the sites and house plans, recruiting the families and keeping them motivated throughout the construction process.


NeighborGood Partners Self-Help Housing Team provides technical and management assistance to organizations in the 21-state northeast region that are operating, or plan to operate, self-help housing programs in their community.


And now, NeighborGood Partners announces an expansion of its lending footprint to extend throughout Region III specifically for self-help housing grantees to assist with their land, lots, and property needs to facilitate production. This is done in recognition of the difficult nature of securing, acquiring, and developing lots and land on which to build and properties to rehabilitate.

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SELF-HELP GRANTEES

Loans will be made for 1-3 years to coincide with the self-help 523 application. The amount will be capped at $1,000,000 or 3 years of projected self-help activity. Typical equity of 10% of land/property acquisition costs will be required. 100% of LTV can be loaned on less than $250,000. Repayment will be made through the sale of lots or properties. Site readiness and applicant capacity and experience will be prerequisites.

If you need access to affordable, customer friendly financing for the land/property component through the self-help housing program, be in touch with Jill Lordan, NeighborGood Partners Self-Help Director.


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For more information about our loan fund products, contact Dave Callahan, NeighborGood Partners Loan Fund Director.

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