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Minnesota Housing Programs

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  1. Minnesota Housing Programs Relocation Aid April 21, 2006

  2. Minnesota Housing’s Mission We are committed to meeting Minnesotans’ needs for decent, safe, affordable homes and stronger communities

  3. Minnesota Housing’s Strategic Goals • End Long-Term Homelessness • Increase Minority Homeownership • Preserve Strategically The Existing Affordable Housing Stock • Provide Housing Choices For Low And Moderate Income Workers • Housing Partner Of Choice

  4. Today’s Multifamily Agenda • Three Goals: • Agency Introduction • Long-term tools: • Case Study • Capital Resources • Short-term tools: • Rental Assistance Resources

  5. Housing Assistance, 10/04 - 9/05 • Single Family • $398.8 million in assistance to over 16,400 homeowners and homebuyers. • Multifamily • $238.5 million to over 41,500 units of affordable rental housing. • Contact staff to determine affordable rental housing available in your area.

  6. Case Study – Agency Financed • New San Marco Apartments • 70 SRO/Efficiency units, New Construction • City of Duluth • Affordable to residents at 30% AMI • 36 Long-term homeless units • 40 Section 8 PBV units • 30 GRH units • Targeting homeless with disabilities

  7. New San Marco - Site

  8. Case Study – New San Marco • Multi-year process: • Planning • Application • Selection • Underwriting • Construction • Occupancy

  9. Case Study – New San Marco • Financing – TDC, $9.2 Million • $5.96 million – Tax Credit Equity ($650,000) • $1.65 million – Minnesota Housing • $500,000 – Federal Home Loan Bank • $400,000 – HUD • $300,000 – Greater MN Housing Fund • $250,000 – City of Duluth (HOME, HIF) • $170,000 – MN Green & Owner Equity

  10. Multifamily Resources • Annual Request for Proposals (RFP) • Capital Resources • Rental Assistance • Operating Subsidy • 2006 RFP • Published, April 24 • Applications deadline, June 20

  11. 2006 RFP Timeline • April 24, 2006 – RFP Published. • May 10, 2006 – RFP Training. • Earle Brown Center, Brooklyn Center • June 20, 2006 – RFP Deadline. • October 26, 2006 – Board Selection.

  12. Multifamily Resources – 2006 RFP • State Resources • Approximately $80,000,000 • Funding Partner Resources • Approximately $5,000,000 • Housing Tax Credits • Approximately $10,000,000

  13. Multifamily Resources – 2006 RFP • Funding Partners • Family Housing Fund • Greater MN Housing Fund • Met Council • Green Communities Initiative • Collaborating Partners • Hennepin County • Ramsey County • City of Minneapolis • City of St. Paul • Coordinating Partners • Federal (HUD & USDA Rural Dev.) • State (DHS, DEED)

  14. Multifamily Resources – 2006 RFP • Minnesota Housing Funding Programs • Housing Trust Fund • Deferred Loan • Capital, Operating Subsidy & Rental Assistance • 70% targeted toward LTH proposals. • Ending Long-Term Homeless Initiative Fund • Deferred Loan • Capital, Operating Subsidy & Rental Assistance • Targets LTH proposals.

  15. Multifamily Resources – 2006 RFP • Funding Programs Continued: • Publicly Owned Permanent Supportive Housing Program • Forgivable Loan, Capital • Public ownership requirement • LTH requirement • Economic Development Housing Challenge • Deferred Loan, Capital • Workforce housing proposals • American Indian set-aside

  16. Multifamily Resources – 2006 RFP • Funding Programs Continued: • Preservation of Affordable Housing Investment Fund • 1st Mortgage or deferred, Capital • Preservation – Acquisition, rehab or debt restructuring of developments with Project Based Federal assistance and supportive housing developments. • Economic Development Housing Challenge • Deferred Loan, Capital • Workforce housing proposals • American Indian set-aside

  17. Multifamily Resources – 2006 RFP • Funding Programs Continued: • Low and Moderate Income Rental Program • 1st Mortgage, Capital • Acquisition, rehab and new construction • Flexible Financing for Capital Costs • Deferred loan – in conjunction with 1st mortgage • Acquisition, rehab and new construction

  18. Multifamily Resources – 2006 RFP • Funding Programs Continued: • Housing Tax Credits • Housing Program under IRS rules • Eligible acquisition, rehab and new construction expenses • Two competitive rounds per year

  19. Rental Assistance Resources • Rental Assistance • Housing Opportunities for Persons w/ AIDS • Short-term Rent, utility and mortgage assistance • ELHIF – LTH specific • Available through the RFP or local administrators • Bridges – SPMI specific • Minnesota Housing partners with DHS • Local Administrators (ELHIF & HTF) • Each program is unique • 21 program administrators statewide • Contact list available on website

  20. Rental Assistance Resources • Rental Assistance • Minnesota Housing Contact: • Kim Lieberman, Program Manager • 651-296-9841 • Kim.Lieberman@state.mn.us

  21. Rent Assistance Resources • Rent Assistance Brochure • www.mhfa.state.mn.us/multifamily/RA_Brochure.pdf • HTF & ELHIF Rent Assistance Program Info. • www.mhfa.state.mn.us/multifamily/HTF.htm • HTF & ELHIF Rent Assistance Program Administrators • www.mhfa.state.mn.us/multifamily/HTFRA_ELHIF_Contacts.pdf • Bridges Program Administrators • www.mhfa.state.mn.us/multifamily/BRIDGES%20Contacts.pdf • Bridges Program Information • www.mhfa.state.mn.us/multifamily/bridges.htm • Family Homeless Prevention and Assistance • www.mhfa.state.mn.us/multifamily/FHPAP.htm

  22. Multifamily Resources • Multifamily Housing • www.mhfa.state.mn.us/multifamily/_home.htm • Consolidated RFP Guide • www.mhfa.state.mn.us/multifamily/MF_Application_Guide.pdf • Housing Tax Credits • www.mhfa.state.mn.us/multifamily/Multifamily_Tax.htm • Long Term Homeless Business Plan • www.mhfa.state.mn.us/multifamily/LTH.htm • Program Guides • www.mhfa.state.mn.us/managers/Program_Guidelines.htm

  23. For More Information Contact Ken Doresky 651-284-3177 Ken.Doresky@state.mn.us 400 Sibley Street, Suite 300 St. Paul, MN 55101 651-296-7608 * 800-657-3769 * TTY 651-297-2361 www.mhfa.state.mn.us

  24. Single-Family Homeownership and Home Improvement Programs April 21, 2006

  25. Supporting Successful Home Ownership Education & Outreach Pre-PurchaseCounseling Before-Purchase Affordable Financing: Loans Purchase Post-Purchase Support Default and Foreclosure Counseling & Assistance After-Purchase

  26. Homebuyer Education Homestretch Curriculum • Advantages vs. disadvantages of homeownership • Mortgage industry terms • Overview of loan application process • Evaluation of credit picture and barriers • Shopping for a home • Home Inspections • Loan closings & forms • Post-purchase responsibilities

  27. First Mortgage Programs Minnesota Mortgage Program (MMP) • Below market interest rate • $3,000 in entry-cost assistance available • Available statewide from participating lenders Community Activity Set Aside (CASA) • Below market interest rate • $3,000 in entry-cost assistance available • Monthly payment assistance ($75, $50, $25) • Option of a 40– year term mortgage • Partnerships apply for the program

  28. Borrower Eligibility RequirementIncome Limits: MMP and CASA • 11 County Twin Cities Metro Area contains: Anoka, Carver, Chicago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington and Wright Counties • These limits are based on data supplied by the US Department of Housing and Urban Development (HUD)

  29. Borrower Eligibility Requirement– House Price Limits For MMP and CASA

  30. Borrower Eligibility Requirement First-time Homebuyer • Has not had an ownership interest in a principal residence for 3 years First-Time Homebuyer (Section 4.3)

  31. Downpayment and Entry-Cost Assistance Homeownership Assistance Fund (2nd Mortgage) • Interest free, deferred loan • Helps borrowers qualify by providing cash to close, improving ratios and increasing borrower purchasing power • Due and payable upon one of the following: • Sale or transfer of property • Refinance of the first mortgage • Payoff of first mortgage • No longer a primary residence

  32. Downpayment and Entry-Cost Assistance • Various levels of assistance depending on mortgage program • MMP • $3,000 in entry-cost assistance for eligible borrowers • Targeted borrower/non-targeted borrower requirements • CASA • $3,000 in entry-cost assistance • Monthly payment assistance ($75, $50, $25)

  33. HAF Program Guidelines • CASA or MMP First Mortgage • Borrower meets income limits • Borrower required to pay out of own funds $500 (Borrower must cover their minimum investment per guidelines of the insurer/guarantor FHA,VA, RD,etc.)

  34. How Borrowers Access Programs Apply with a lender that originates Minnesota Housing first mortgage programs. The lender originates, processes, underwrites, closes and funds the loan, then sells the loan to Minnesota Housing.

  35. Credit Requirements • Credit worthiness (Section 4.7) • Must be a good credit risk as defined by loan type and mortgage industry underwriting standards • FHA • VA • RD • Conventional (Fannie Mae, Freddie Mac, etc.)

  36. Mortgage Eligibility Fully amortized fixed rate loans- No balloons Allowable Loan Amortization Terms • MMP (15, 20, 25, 30) • CASA (15, 20, 25, 30, 40)

  37. Increased Purchasing Power & Cash to Close $60,000 Income, 20% added to PITI for Taxes & Insurance, 33/38 5.625% $206,700 $3,000 $217,400 $233,300 $233,300 CASA = An increase of $37,100 in buying power and $3,000 cash to close!

  38. Home Improvement Programs • Improve livability, accessibility or energy efficiency of a home • Accessibility features • Room additions • Accessible bathrooms • Ramps • Hardwood flooring • Hallway widening

  39. Home Improvement Programs • Fix-Up Fund • Flagship program • Community Fix-Up Fund • Community targeting • Subprime features • Rehab Loan Fund • Targeted to very low-income borrowers

  40. Fix-Up Fund • Max loan $35,000 • Higher loan amount possible if serving a household member with a disability • Fixed payments • Max repayment 20 yrs • No down payment • Low closing costs • 110% LTV • Unsecured loans if < $10,000

  41. Community Fix-Up Fund Special home improvement programs for targeted community initiatives! • Same terms and conditions as the fix-up-fund • Subprime component available • To access this program: www.mhfa.state.mn.us/homes/CFUF_Matrix.pdf

  42. Fix-Up Fund and Community Fix-Up Fund Requirements • Household incomes: $90,000 • Income waiver possible if serving a family member with a disability • Decent credit • Owner-occupied homes (No cabins!)

  43. Rehab Loan Program • Features: • Max loan amount is $15,000 • Additional $5,000 can be accessed in hh contains a family member with a disability • Single-family homes = 30 yr. term with 0% interest rate loan payment deferred until borrower sells, transfers title or no longer occupies the property • Requirements: • Income limits apply (4 person hh is $23,550) • Owner-occupancy required • Assets not greater than $25,000 • Access by contacting an administrator: www.mhfa.state.mn.us/homes/Rehab_Administrator_by_County.pdf

  44. Resources • Homebuyer Education • Minnesota Home Ownership Center, www.hocmn.org • First-Time Homebuyer Programs • www.mhfa.state.mn.us/homes/homes_mortgage.htm • Downpayment and Closing Cost Assistance • www.mhfa.state.mn.us/homes/homes_payment.htm • Home Improvement Programs • www.mhfa.state.mn.us/homes/homes_improvement.htm • Foreclosure Prevention Assistance • www.mhfa.state.mn.us/homes/homes_foreclosure.htm

  45. For More Information Contact Devon Pohlman (651) 296-8255 Devon.Pohlman@state.mn.us 400 Sibley Street, Suite 300 St. Paul, MN 55101 651-296-7608 * 800-657-3769 * TTY 651-297-2361 www.mhfa.state.mn.us