Down Payment Assistance Fund
Total Annual Award
Down Payment Loans will be limited to the lesser of $1 million and 10% of the contracted purchase price. No more than one Down Payment Loan is permitted per developer until each loan is repaid.
Tenant Eligibility Criteria
As described in its Notice of Funding Availability, in its first round of funding, beginning March of 2019, the Down Payment Assistance Fund will focus its activities on the development of supportive housing. Supportive housing is defined as affordable housing matched with a government-funded social service contract for the provision of on-site social services.
Eligible sponsors are pre-qualified, nonprofit developers of permanently supportive or mixed affordable and supportive housing projects in New York City. Priority projects will be those that intend to receive permanent financing through HPD’s Supportive Housing Loan Program (SHLP), as well as those financed by HPD’s Senior Affordable Rental Apartments (SARA) and Extremely Low and Low-Income Affordability (ELLA) programs, with a minimum 30% set-aside of supportive units in both of the latter two programs.
Funding Award Details
Through a New Construction Down Payment Assistance RFQ administered by HPD, nonprofit affordable housing developers with established track records and strong financials will be screened and pre-qualified.
The rate of interest to DPAF borrowers is expected to be 3.0% fixed. Interest payments will be deferred, accruing on a monthly basis and payable at loan maturity.
The full principal amount will be due at the earlier of the closing date of an acquisition loan and the maturity date [not to exceed 12 months]. The closing of the acquisition loan will be conditioned on a soft take-out commitment from the New York City Department of Housing Preservation and Development (HPD) and the New York City Housing Development Corporation (HDC), or from other government take-out sources, as applicable.
Borrowers must fund all out-of-pocket costs preceding signing of the purchase contract, including the DPAF’s closing and legal fees, and the Fund’s early due diligence on land values and site environmental conditions.
100% recourse to the Borrower. Sponsors will be required to sign a payment guaranty for the full amount of the loan along with accrued interest and expenses.
An origination fee equal to the greater of 1.0% of the down payment loan amount and $5,000 will be payable to the DPAF Originating Lender at the signing of a purchase contract for the subject property. Borrower will also be charged for DPAF closing legal fees.
For More Information
A full term sheet and Notice of Funding Availability, describing priorities for funding are available on the DPAF website.
Applicants should direct all communications and inquiries regarding this RFQ to HPD at: DownPaymentAssistanceRFQ@hpd.nyc.gov
Last updated: 03/29/2019
Did you know…
Homeless people given supportive housing saved NYS taxpayers an average of $10,100 per person per year.