Real Estate Development Loans

Loans are provided for all phases of affordable housing development and can be used for:

• Real estate option/acquisition

• Pre-development expenses (legal fees, design costs, appraisals, etc.)

• Construction and/or rehabilitation financing

• Bridge loans

• Permanent financing

Eligible projects may include:

• Multi-family rental housing

• Supportive housing for people with disabilities

• Single-family homeownership

• Lease-purchase housing

• Mixed use developments (There is a separate application (link to Mixed Use Page) for these projects)

• Cooperatives, land trusts for residential uses

• Transitional housing – more than 90 days on up to two years, SRO or family units that include supportive services (not group “shelters” or emergency arrangements)

• Special needs housing including group homes for the disabled or elderly

Loan amounts range from $10,000 to $1.2 million.

Terms are flexible with a wide range of loan amortizations/maturities.

Interest rates are affordable and designed to accommodate the needs of the project.

Security

• Security is typically in the form of a real estate mortgage on the project itself, but may be on other property, and shall not exceed 100% of the appraised value of the secured property.

• All collateral must be insured.

• Assignment of syndication proceeds in certain tax credit projects with scheduled pay-ins of equity.

• Escrow accounts for taxes and insurance may be required.

We primarily provide housing development loans to nonprofit 501(c)(3) or 501(c)(4) organizations, e.g. housing development corporations, cooperatives, land trusts, community development corporations, faith-based institutions, labor unions, credit unions, and social service agencies with a stated mission of creating affordable housing.

New and experienced development organizations are welcome, with preference given to those who demonstrate a willingness and capability to carry out development on an ongoing basis.

Current borrowers of OppFund dollars are eligible, provided the outstanding loans are not in any way delinquent or in default.

For-profit entities and local units of government may also be eligible.

All projects must meet OppFund’s eligibility criteria:

• Increase or maintain the quantity of quality, affordable housing

• Primarily benefit households with incomes between 30% and 80% of area median family income

• Demonstrate community support

• Be sponsored by an organization incorporated in Michigan

• Demonstrate ability to receive and administer funds and ability to repay the loan

• Provide security for the loan and have a positive impact on the Fund’s portfolio

• Ensure long-term affordability