PROGRAM DESCRIPTION: Eligible applicants receive loans for rental housing in rural areas to provide living units for persons with very low, low, and moderate incomes.
TYPE OF ASSISTANCE: Loans can be made for a variety of rental housing types, for example, family, elderly, congregate and group home.
ELIGIBILITY REQUIREMENTS: Applicants should have the ability and experience to operate and manage a rental housing project successfully.
FUND AVAILABILITY: Preapplications are selected into the funding cycle based on an Notification of Fund Availability (NOFA) which is published annually. Only those communities listed in the NOFA are eligible for this funding.
INTEREST RATE: Closed at the current market rate with an Interest Credit Agreement reducing the loan to a 1% interest rate. Interest subsidies vary based upon tenants' certified income.
TERMS AND COLLATERAL: A 30 year mortgage with a possible 50 year amortization, no prepayment allowed. Appraisal must indicate security value equal to or greater than the loan.
CREDIT REQUIREMENTS: Government agencies or non-profits do not have a capital contribution. Other entities seeking Low Income Housing Tax Credits (LIHTC) have a 5% capital contribution requirement. Entities not seeking LIHTC will have a 3% capital contribution requirement.
CONTACT: Preapplications are made at the Rural Development State Office during the timeframe stipulated in the NOFA.
For assistance, please contact the Area Office which serves the area you are interested in, or William Hobbs, Program Director. Mr. Hobbs can be reached at 919-873-2063 or email:email@example.com.
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