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Preservation Plus Financing
Terms
- 35 year maximum term
- 35 year maximum amortization
Fees
- Origination Fee is 1.5% of mortgage loan commitment amount for permanent financing only 2.5% of the mortgage loan commitment amount for WHEDA construction financing converting to permanent financing.
- Loan Structuring Fee (non-refundable) of one-half of the origination fee is payable upon acceptance of the Mortgage Loan Commitment; this fee is credited toward the loan origination fee at closing.
- Application Fee of $250 for developments of 24 units or fewer, or $500 for developments of 25 units or more.
Fees are subject to periodic review and change.
Eligibility
- Eligible borrowers include For-profit, qualified non-profits, housing authorities, or other entities meeting criteria established by WHEDA.
- Eligible developments must be existing residential rental housing for families, elderly, or people with disabilities. Each rental unit must be complete and include separate tenant spaces for living, sleeping, cooking, eating, and sanitation. Shared tenant spaces are allowed only if the Borrower is a qualified 501(c) (3) corporation.
- Eligible developments are limited to affordable housing developments assisted under the following or similar programs:
- Section 8 project-based
- Section 236
- Section 202
- Section 811
- Section 221(d) 4
- Section 515 RD
- LIHTC
- Others as determined by WHEDA
- Developments must be for:
- Acquisition with substantial rehabilitation of an existing building; the value of rehabilitation and essential equipment must equal or exceed 15% of that portion of the cost of buildings and fixtures financed with bonds.
- Eligible developments are limited to affordable housing developments assisted under the following or similar programs:
Minimum Set-Aside Units
20% of all units set-aside for households with incomes not exceeding 50% of County Median Income (CMI).
Or
40% of all units set-aside for households with incomes not exceeding 60% of CMI.
Total rent plus utilities cannot exceed 30% of the respective CMI levels.
How to Use Preservation Plus with Tax-Exempt Bond Financing
- Consider your market. A market study helps you assess the market you are considering; will it work or not? Prepare according to the guidelines in Appendix A.
- When financing an existing multifamily property, a capital needs assessment identifies and quantifies a building's current physical condition and future physical and financial needs. Find a provider and prepare according to the guidelines.
- Talk to a Commercial Lending Officer (CLO) regarding any pre-application issues.
- Complete an application and send it to WHEDA, along with the application fee. Use the application checklist when completing your application package.
- Your application will be reviewed and a CLO will contact you within 4-5 days upon receipt.
- Always know that you may contact an CLO during the process if you have any questions.