 |
| Term Sheet |
| Taxable Lending |
|
| Purpose |
MSHDA offers taxable loans to support 9% tax credit rental housing. A subordinate HOME or Preservation Fund loan may be provided to the extent certain objectives are met, including rural housing, lower income family, integrated supportive, and workforce housing. |
| Eligible Borrowers |
Non profit housing corporations and limited dividend entities eligible under the Authority's Act. |
| Eligible Developments |
New construction and acquisition and rehabilitation of rental developments for family or senior citizens of 24-150 units. |
| Loan Limits |
110% of the applicable for-profit HUD 221(d)(3) Mortgage Limits. For profits can receive up to 90% of the total development cost, subject to the above limitation. |
| Income Restrictions |
Typically all units targeted to 60% of the AMI and below, but mixed income housing permissible where at least 20% of the units are affordable to households at 50% of AMI or 40% of the units are affordable to households 60% of the AMI. |
| Rate |
10 Yr T-Note rate + 300 Basis Points, fully amortizing over a 35-year loan term as of date of complete application. |
| Term |
35 years
|
| HOME/Preservation Fund Loan Rate/Amortization |
3% simple interest amortized over 50 years. Payments may be deferred for up to 12 years if deferred developer fee exists. Annual payments made from available cash flow, with unpaid balance, including accrued interest, becoming the new first after the first mortgage balance is paid. |
| Debt Coverage Ratio |
1.10 minimum
|
| Loan Guarantee |
Non-recourse |
| Prepayment Provision |
15 year prepayment prohibition |
| Affordability Requirement |
35 year original mortgage term or 50 years if combined with HOME or Preservation Fund loan. |
| Operating Assurance Reserve |
Operating Assurance Reserve (OAR) will be established equal to four months estimated operating expenses. OAR held by MSHDA and accumulates interest. |
| Replacement Reserve |
Replacement reserve of $250 per unit for elderly and $300 per units for family housing and rehabilitation. |
| Michigan Green Communities Grant |
Grant of $1,000 per affordable unit, up to a maximum of $50,000 is available from MSHDA for developments meeting the Michigan Green Communities criteria. The Enterprise Foundation matching funds and a $3,000 grant for administrative reporting is available. |
| Environmental Reviews |
Phase I Environmental Site Assessment required. |
| Origination and Other Fees |
2% of mortgage loan amount. LIHTC application, commitment and compliance fees apply.
|
| Application Fee |
$1000 |
|
|
Printer Friendly
Text Version 
Email Page
