Predevelopment Loans
Up-front expenses that are incurred before breaking ground can present a barrier to small, community- based nonprofits and other developers of affordable homes. Pre-development financing helps organizations obtain the resources needed to get a development under way.
We offer loans in two amounts: Phase 1 pre-development loans for up to $50,000 and Phase 2 loans for up to $250,000. We use these guidelines and criteria:
Phase I Pre-Development Loan
Eligible Uses:
Costs associated with feasibility evaluation and preparing site specific applications to public and private funders, such as site control costs, engineering and environmental studies, soils testing, design work, legal fees.
Loan Size: Up to $50,000
Terms & Conditions:
- 6.5 -10% interest
- Minimum origination fee of $2500
- Up to 12 months with extension options
- Recourse to borrower
- Personal guarantee of principals of for-profit developers
Additional Requirements:
- Eligible projects include emergency housing; transitional housing; rental
or mixed-use projects that have an affordable or workforce housing component. - A minimum of 51% of the units must be affordable to households at or below 80% of area median income.
Phase II Pre-Development Loan
Eligible Uses:
Site control extension payments, property-holding costs, A&E, consulting, legal, application and financing fees including interest reserve, permit fees, eligible costs for LIHTC carryover requirement.
Repayment of OCHT Phase I Predevelopment loan.
Loan Size: Up to $250,000
Terms & Conditions:
- 6.5 – 10% interest
- 2% loan origination fee at closing
- Up to 12 months with extension options
- Interest only payments
- Secured by lien on property and/or lien on other unencumbered assets; may subordinate
- Recourse to borrower
- Personal guarantee of principals of for-profit developers
Additional Requirements:
- Eligible projects same as in Phase 1
- A minimum of 51% of the units must be affordable to households at or below 80% of area median income.
- Enforceable commitments of repayment source(s)
To apply for an OCHT loan, please download, print out, and complete the loan application form.
- Please complete all questions in the application.
- Provide the attachments that have been requested to provide evidence of commitments and to provide information directly related to the project.
- Enclose a check for the $500 application fee made payable to:
Orange County Housing Trust.
Orange County Housing Trust Loan Application
(PDF Format)