Homeownership Development

The Housing Partnership Fund began making homeownership production loans in 2004. To be eligible for Fund financing, homes must be affordable to families whose incomes are 120 percent or less of their area's median income. Detached, attached, and condominium structures are all eligible.

We offer two lending products:

Homeownership Predevelopment Loans
Predevelopment loans provide preacquisition capital to help borrowers determine the feasibility of projects and to enable them to reach closing. These loans are repaid from the proceeds of acquisition financing.

Homeownership Development Acquisition Loans
Development acquisition loans provide ready capital for the acquisition of sites or buildings that are intended for affordable homes. In addition to acquisition costs, these funds may be used for site and lot development costs, as well as for the refinancing of predevelopment costs expended prior to acquisition. Designed primarily as affordable subordinate capital, the Fund has also taken senior lien positions on smaller projects. Development acquisition loans are repaid from the proceeds of construction financing, or from the sale of finished lots. The Fund typically does not act as a lender during the home construction period.

In underwriting a proposed loan, the Fund examines the borrower's capacity and history with projects of the type proposed. We review market and pricing assumptions, which usually require a professional market study. To the extent that construction financing is prospective, we examine contingency plans. Because all lending is recourse to the Network member, we also examine the financial condition of the borrower and/or the parent.

The Fund will close $2 million in homeownership development loans in 2007, including the purchase of a site for a mixed-income, mixed-use development in Brookline, Massachusetts.

For more information, contact Matt Perrenod.