Community Developments Investments (February 2018)
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Expanding Housing Opportunities: Single-Family Rehabilitation Financing Programs
National banks and federal savings associations (collectively, banks) that offer single-family rehabilitation financing are critical partners in community-wide efforts to revitalize neighborhoods.
The OCC has issued guidance to spur community revitalization through prudent higher-loan-to-value mortgage lending in targeted areas.
Banks are important partners in community development efforts to revitalize and stabilize distressed communities, and can receive Community Reinvestment Act consideration by providing community development loans, investments, and services.
In Detroit—a distressed city with low-value housing stock where the cost to purchase and renovate a property can exceed the market value—banks have joined together in launching an initiative to offer financing that addresses the "appraisal gap."
The Federal Housing Administration Section 203(k) program offers two levels of rehabilitation loans: one to finance the purchase or refinancing of a house and the cost of its rehabilitation through a single mortgage, and another to finance less extensive repairs or improvements to the borrower's existing home.
TD Bank and several community-based organizations are working together on an initiative that combines a historic tax credit equity investment with funding from other partners to revitalize several contiguous historic neighborhoods in East Baltimore.
Home buyers, investors, nonprofit organizations, and local government agencies can use the Fannie Mae HomeStyle Renovation loan product to finance up to half of a single-family property's "as completed" appraised value.
Community-based NeighborWorks America member organizations are engaged in a variety of efforts to stabilize communities through acquisition and rehabilitation of vacant, foreclosed, and distressed properties. By pairing responsible mortgage products with home buyer education programs, NeighborWorks affiliates in several cities are ensuring that their initiatives are providing lower-income home buyers with sustainable homeownership solutions.
U.S. Bank's American Dream mortgage program extends purchase-money mortgages with low down payments, as well as a rehabilitation loan option. The bank offers home buyer education along with support to help low- and moderate-income home buyers manage the rehabilitation phase of their project.
The National Community Stabilization Trust is working closely to build partnerships between banks, mortgage servicers, investors, and community-based organizations to combat blight in communities that have been hit hard by mortgage foreclosures.
This publication is part of:
Collection: Community Developments Investments
Deputy Comptroller
Barry Wides
Editorial Staff
Letty Ann Shapiro
Dianne Davenport
Janet Fix
Design Staff
Victor Battista
On the cover
Before-and-after image of a home in New Orleans rehabilitated by Redmellon Restoration & Development, a mission-driven real estate development company.
For questions or comments, call (202) 649-6420 or email communityaffairs@occ.treas.gov. This and previous editions are available on the OCC's website at www.occ.gov.
Disclaimer
Articles by non-OCC authors represent the authors' own views and not necessarily the views of the OCC.
Deputy Comptroller
Barry Wides
Editorial Staff
Ted Wartell
Bill Reeves
David Black
Dan Gibbard
Design Staff
Rick Shacklette
Cheryle Robison
For questions or comments, call (202) 649-6420 or email communityaffairs@occ.treas.gov. This and previous editions are available on the OCC's website at www.occ.gov.
Disclaimer
Articles by non-OCC authors represent the authors' own views and not necessarily the views of the OCC.