Docstoc

Responding to NN

Document Sample
Responding to NN Powered By Docstoc
					                                                     10/16/2009




  Responding to the New Normal:
   Innovation, Outsourcing, and
          Capitalization
                     Steve Fireman
      Economic and Community Development Institute
                    October 30, 2009




Overview of ECDI
 Microenterprise Development
   Microloans
   Training
   Technical Assistance
   Business Incubation
   IDAs




ECDI’s Nine Loan Funds
 SBA (Intermediary Microlender)
 US Treasury CDFI Fund
 HHS OCS Community Economic Development
 Program (job creation focus)
 HHS Office of Refugee Resettlement
 Ohio Department of Development
 City of Columbus Department of Development
 Franklin County Economic Development and
 Planning
 Columbus Foundation
 Key Bank




                                                             1
                                                       10/16/2009




What does “Technical
Assistance” mean to us?
All the usual suspects, including classroom training
and one-on-one business coaching ,

PLUS…

           TA,
     Legal TA including:
            On staff lawyer
            Pre-paid
            Capital law
            Law firm referral


                             PLUS…




The Growing Entrepreneurs
Initiative
  Innovative Business Incubation Program
  Creates Continues Opportunity and Access to
  Markets
     Home Repair Program (2005)
     F dI     b t
     Food Incubator
     Transportation Business
     More to Come
  Creation of Unrestricted Income for ECDI




Need for Efficiency!

  Because of 9+ loan funds
  Because of other lines of business

So…we are i
S               l     ti       t   hi
            implementing a partnership
with Accion Texas (MMS), CIVIC (CRM),
and linking these databases to an
online strategy




                                                               2
                                                         10/16/2009




       The New Normal: Innovation, Outsourcing, and
                                Capitalization
                               Loren Berlin, Self-Help
                                          30
                                 October 30, 2009




                   Self-Help Lease Purchase
                  Mortgage Product Overview



                             Loren Berlin
                             October 2009




Presenter logo here
(delete if not applicable)




 Who is Self-Help?
CDCU & one of nation’s largest CDFIs
Mission: Create/preserve economic opportunity and
wealth-building strategies for LMI families
Services in our footprint (NC, limited in DC & CA)
    Lending: home, small businesses, nonprofits,
    developers
    Commercial/Residential real estate development
Services Nationwide
    Nonpartisan policy research on abusive financial
    services (Center for Responsible Lending)
    Secondary Market for Home Loans
    Lease-Purchase Mortgage Product
Presenter logo here
(delete if not applicable)




                                                                 1
                                                                10/16/2009




Lease Purchase Mortgage Product
  Fannie Mae mortgage
  Credit-enhanced through Self-Help’s secondary mkt
  30-year, fixed rate, 97% max LTV
  Pricing: approx. 6.5%
  Nonprofit borrower pre-approved by Self-Help
       Self-Help may approve nonprofit up to $10MM
       Originating lender underwrites property,
       documents mortgage
  Assumable mortgage by qualified tenant
  Not a renovation product -> takeout for short-term
  acquisition/rehab financing


   Presenter logo here
   (delete if not applicable)




Lease Purchase Mortgage Product
  At origination:
     1 -5 yr. agreement btwn nonprofit and tenant
     Tenant is qualified for affordability:
         38/50 DTI and 12 months employment
  At assumption:
     Tenant is qualified for affordability (38/41) and credit
     (620 FICO min, alternative credit ok)
     Nonprofit may share appreciation w borrower
  During lease term:
     Counseling required
     Homebuyer contribution toward savings required
     Reporting to Self-Help required

   Presenter logo here
   (delete if not applicable)




    Why Lease Purchase?
  Vacant Properties + Displaced Families = Need for
  additional financing tools
  Projected 9MM foreclosures 2009-2012
  3 – 5 yrs minimum wait to qualify for home loan
  after foreclosure
  Down payment an obstacle for l
  D                   b                i
                            l f low-income
  homebuyer
  Single-family financing less costly than multi-family
  Tweak, rather than reinvent, the wheel




   Presenter logo here
   (delete if not applicable)




                                                                        2
                                                              10/16/2009




   Underwriting the Nonprofit
 Overall feasibility of lease-purchase program
    Lease comparable to market rents
    Reasonable vacancy assumptions/reserves
    Covering costs of PITI, counseling, savings, property
    mngmt
 Track record of nonprofit borrower/partners
                               site,
    Management of scattered site SF stock
    SF acquisition and rehab experience
    Sourcing/screening tenants
 Financial viability
    Scale proportional to organization
    Ability to weather vacancies or continued rental
    Nonprofit financial strength can offset thin margins on
    lease purchase portfolio
  Presenter logo here
  (delete if not applicable)




Lease Purchase Program Goals
 Neighborhood Goals
      Stability (minimize vacancies)
      Transform foreclosures into wealth-building assets
      for low-income families and communities
 Household Goals
      Provide path to, or back to, homeownership
 Program Path
      Test multiple pilots, then pursue scalibility




  Presenter logo here
  (delete if not applicable)




Is Lease Purchase Right for You?
 Will lease purchase work in your community?
 Is there demand, and do you have a good pipeline of
 prospective tenants?
 Will market rents support debt service plus
 operating costs?
 Can you manage a scattered-site single family
 C                          d i    i l f     il
 rental portfolio?
 Do you have counseling capacity to meet the needs
 of your target market?




  Presenter logo here
  (delete if not applicable)




                                                                      3
                                              10/16/2009




Questions


   For further information, please contact:
        Loren Berlin (919) 956-4439,
          loren.berlin@self-help.org
                                349 1866,
    Catherine Godschalk (202) 349-1866
     catherine.godschalk@self-help.org
        Vanita Kalra (202) 349-1864,
          vanita.kalra@self-help.org




                                                      4
                                                                10/16/2009




    Responding to the New Normal: 
Innovation, Outsourcing, and Capitalizing 

                                         Presenter:
                                    Tom Fulton, President
                                    Family Housing Fund 




   About the Family Housing Fund
Established in 1980, the 
Family Housing Fund’s 
mission is to provide safe, 
affordable, sustainable 
homes to families and 
children in the Twin Cities 
metropolitan area through 
metropolitan area through
ongoing partnerships with 
the public and private sector. 

The  Family Housing Fund is 
a supporting organization of 
the cities of Minneapolis 
and Saint Paul, the 
Metropolitan Council, and 
the Minnesota Housing 
Finance Agency. 




           Home Prosperity Fund




  In January 2008, the Family Housing Fund launched the 
  Home Prosperity Fund, a new financing tool to revitalize 
  neighborhoods and increase housing opportunities in the 
  Twin Cities metropolitan area with the goal of raising $50 
  million by 2012.  




                                                                        1
                                                            10/16/2009




          Home Prosperity Fund 
           Investments to Date




Dramatic Change in Grants vs. Loan 
  Funds Secured for Organization
   • In first 25 years (1980 to 2005), the Fund raised 
   approximately $160 million, with $145.5 million (91%) 
   in grant funds and $14.5 million (9%) in loan funds.

   • In just the last three and ½ years (2006 to 2009), 
   the Fund has raised approximately $67 million, with 
   $32 million (48%) in grant funds and a total of $35 
   million (52%) in new loan funds. 




 Organizational Implications for the 
       Family Housing Fund
              • Internal Organization and Culture

              • Relationships with Stakeholders

              • Impact of National Attention


The Fund’s Challenge: Synthesize the 
need/opportunity for innovation, speed, 
and scale with best practices for prudent 
CDFI activity.  




                                                                    2
                                                               10/16/2009




Home Prosperity Fund Investors
  Wells Fargo                          $5 million
  US Bank                              $2 million
  TCF Bank                             $1 million
  Minnesota Housing                    $10 million
  Thrivent Financial for Lutherans     $1 million
                                       $
  The McKnight Foundation              $5 million
  The Pohlad Family Foundation         $1 million

  Total Funds Raised                   $25 million




             Home Prosperity Fund 
             Development Partners
 Nonprofit and Government Partners
 Twin Cities Habitat  for Humanity
 Greater Metropolitan Housing Corporation
 Dayton’s Bluff Neighborhood Services
 HOME Program
 HOME P
 Dakota County Community Development Authority
 Model Cities 
 St. Paul Housing and Redevelopment Authority
 Minnesota Preservation Plus Initiative
 Project for Pride in Living
 Twin Cities Community Land Bank




   Development Partner Results
 With Home Prosperity Fund assistance, the development 
 partners have*:

 • Acquired and/or developed 229 properties, including 
 172 in North Minneapolis (hardest hit area in Twin Cities.)

 •Assisted 33 households in purchasing homes.  Of these:
         ‐‐70% are at or below 50% medium area income
         ‐‐55% are families with children
         ‐‐55% are households of color

* As of 6/30/09




                                                                       3
                                                                 10/16/2009




Twin Cities Community Land Bank LLC




 The Twin Cities Community Land Bank, launched in 
 September 2009, is a subsidiary organization of the Family 
 Housing Fund that was formed to respond quickly and 
 effectively to the challenges and opportunities of the 
 foreclosure crisis and to further regional growth objectives 
 linking housing, jobs, transportation, and education.  




Twin Cities Community Land Bank
 The Twin Cities Community Land Bank was formed as a 
 strategic tool for government, neighborhood based 
 organizations, community development corporations, and 
 nonprofit and for profit developers to support neighborhood 
 recovery and further community economic development.

 $30 million has been committed to support neighborhood 
 revitalization efforts to:
          ‐‐Maximize Neighborhood Stabilization Program  
          (NSP) investments
          ‐‐Support the National Community Stabilization
           Trust’s First Look and Aged/Targeted Bulk Purchase
           Programs




                                                                         4
The Coordinated Plan
to Address Foreclosures in Minnesota
A review of Successes to Date and Calls to Action as summarized
by the Minnesota Foreclosure Partners Council
March 2009
The Problem
The number of mortgage foreclosures in Minnesota and throughout the country
is dramatically increasing. Minnesota experienced about 6,500 foreclosures in
2005. In 2008, that number increased to nearly 27,000 foreclosures. Unfortunately,
foreclosures are expected to continue to impact all parts of Minnesota in 2009
and beyond. Foreclosures are overwhelming existing resources and displacing
thousands of families and children, while vacant and boarded structures are
devastating neighborhoods and surrounding property values and frustrating
community reinvestment and recovery.

The Solution
The Minnesota Foreclosure Partners Council was convened in January 2007 to
facilitate a rapid, coordinated response to the mortgage foreclosure crisis affecting
the Twin Cities metropolitan area and Greater Minnesota. The council, in colla-
boration with many other key private and public partners, has made great strides.
However, given the enormity of the problem, much work remains to be done
to help stabilize neighborhoods and help families succeed throughout the state.
The Coordinated Plan to Address Foreclosures in Minnesota highlights the successes
to date and presents next steps and calls to action in the areas of data collection,
homebuyer and tenant counseling, targeted outreach, product development,
neighborhood and community recovery, and legislative and legal strategies.
                    1. Data Collection
Successes to Date   • Collected and analyzed statewide foreclosure data through the work of HousingLink, Family Housing Fund,
                      Greater Minnesota Housing Fund, Minnesota Home Ownership Center, and the Federal Reserve Bank of
                      Minneapolis.
                    • Expanded data sharing between cities and counties, including the expanded use of early warning systems.
                    • Diverse sectors partnered to pass new legislation to make more information readily available in the
                      published information required for non-judicial foreclosures.
                    • Statewide legislative task force formed to make recommendations on the development of a platform to
                      improve and expand predictive and analytical data collection.
   Call to Action   • Implement legislative recommendations on a statewide data collection platform.

                    2. Homeowner and Tenant Counseling
Successes to Date   • Implemented a statewide foreclosure prevention capacity building initiative that more than tripled the
                      number of mortgage support counselors serving at-risk homeowners throughout Minnesota with funding
                      provided by National Foreclosure Mitigation Counseling, Minnesota Housing, Family Housing Fund,
                      Greater Minnesota Housing Fund, and other public and private funders.
                    • Developed a statewide tenant assistance capacity building initiative adding additional capacity at
                      HOMELine, Legal Aid, Southern Minnesota Regional Legal Services, and Centro Legal.
                    • Minnesota Housing has been awarded over $8.5 million in National Foreclosure Mitigation Counseling
                      funds to support the expansion of the statewide counseling network—the second largest amount awarded
                      to any state housing agency in the country.
                    • Landmark legislation was passed that provides counseling agencies with contact information of distressed
                      homeowners prior to the commencement of foreclosure proceedings so that every homeowner at risk is
                      personally contacted and made aware of free, confidential counseling services.
                    • Mortgage servicers created dedicated call lines for use by mortgage support counselors and distressed
                      homeowners.
                    • Mortgage support counselors keep regular office hours at community libraries, neighborhood offices,
                      and recreation centers.

  Calls to Action   • Sustain statewide counseling capacity for at-risk homeowners and renters.
                    • Expand counseling capacity for non-English speaking homeowners and renters.
                    • Collaborate with lenders and servicers to promote timely and effective loss mitigation practices.

                    3. Targeted Outreach
Successes to Date   • Minnesota Home Ownership Center and tenant advocacy agencies developed a comprehensive outreach
                      and education campaign utilizing a range of materials, tools, and information for tenants, homeowners,
                      professionals, and referral agencies with funding from National Foreclosure Mitigation Counseling,
                      Minnesota Housing, Family Housing Fund, Greater Minnesota Housing Fund, and numerous other private
                      and public funders.
                    • Minnesota Home Ownership Center provides workshops for homeowners and referral agency professionals
                      in partnership with mortgage servicers, legal assistance providers, local governments, and nonprofits.
                    • Expanded outreach to and services for communities of color and non-English speaking households.
      Targeted Outreach Continued

                            • The Family Housing Fund, in partnership with the Minnesota Home Ownership Center, reoriented and
                              reactivated Don’t Borrow Trouble Minnesota™ messaging in English and Spanish around foreclosures.
                            • City of Saint Paul posted foreclosure prevention hotline information on more than 400 public works vehicles.
                            • City of Saint Paul staff were trained to recognize the signs of foreclosure and distribute materials to house-
                              holds in distress.

	 	      Calls to Action    • Continue outreach and education initiatives directed to homeowners and renters, as well as through
                              partnership and referral networks.
                            • Expand outreach and education to non-English speaking homeowners, renters, and referral networks.
                            • Develop video tool for broadcast on public television and other outlets encouraging homeowner action to
                              avoid foreclosure.
                            • Partner with employers to connect with employees affected by layoffs.
                            • Enhance outreach messages to target changing at-risk populations, for example, more distressed home-
                              owners in suburban communities and Greater Minnesota.

                            4. Product Development
	 	 Successes to Date       • City of Minneapolis developed Minneapolis Advantage, a successful down payment and closing cost
                              assistance pilot program to help rebuild the housing market in key neighborhoods that have experienced
                              mortgage foreclosures.
                            • City of Saint Paul developed the Make it Possible program, administered through Dayton’s Bluff Neighbor-
                              hood Housing Services, to stabilize Invest Saint Paul neighborhoods by providing current homeowners with
                              the option to refinance out of adjustable rate mortgages and an incentive for people to purchase vacant or
                              foreclosed properties.
                            • Greater Metropolitan Housing Corporation (GMHC) developed the Bridge to Success Contract for Deed
                              program, administered through GMHC and Dayton’s Bluff Neighborhood Housing Services, to stabilize
                              key neighborhoods in Minneapolis and Saint Paul.
                            • Collaborating with mortgage originators to refinance distressed homeowners on case-by-case basis.
                            • City of Brooklyn Park reallocated resources to provide down payment assistance for families purchasing
                              foreclosed homes. In conjunction with this effort, the city held homebuyer fairs providing “one stop”
                              shopping to match potential homeowners with lenders and appropriate mortgage products.
                            • Cities, community development corporations, and their partners are developing and employing innovative
                              contract for deed and other models to enable working families to purchase homes.
                            • Cities will use Federal Neighborhood Stabilization Funds to assist new purchasers with products that
                              create opportunities for successful homeownership.
         Calls to Action    • Support loan products that provide refinancing for distressed homeowners.
                            • Address outstanding challenges still facing renters and new potential buyers unable to purchase a home due to
                              damaged credit from a foreclosure and the tightened credit market.
                            • Partner with originators, local governments, and associations to prepare new homeowners and new
                              landlords for challenges of the marketplace and housing stock.
                            • Develop land trust and land bank models.
                            • Partner with local and national mortgage lenders to provide purchase loans.
                      5. Neighborhood and Community Recovery
Successes to Date   • The Family Housing Fund launched the Home Prosperity Fund in 2008 with initial investment loans
                      of $16 million from Wells Fargo, US Bank, TCF Bank, Thrivent Financial, and Minnesota Housing for
                      strategic acquisition and rehabilitation and programs to assist affordable sustainable homeownership
                      throughout the Twin Cities. New 2009 commitments from The McKnight Foundation and Wells Fargo
                      put the total pool at $24 million.
                    • Minnesota Housing released $9.2 million in federal HOME funds to provide down payment and entry
                      cost assistance with the acquisition of foreclosed homes by new homeowners as a primary target.
                    • Minnesota Housing implemented the Homeownership Opportunity Program to provide a bridge loan to
                      enable homeowners to acquire and rehabilitate either foreclosed homes or homes in danger of foreclosure.
                    • Several cities employ point of sale ordinances that require properties be brought to certain standards
                      upon resale.
                    • Minneapolis and Saint Paul are piloting the First Look Program, developed by the National Community
                      Stabilization Trust, to help restore neighborhoods hardest hit by foreclosures by allowing the two
                      cities to acquire foreclosed properties before they are put on the market. Partners are also considering
                      opportunities to work with servicers in highly impacted communities in greater Minnesota.
                    • Greater Metropolitan Housing Corporation, with the support of local partners and investments from
                      the City of Minneapolis, the State of Minnesota, and the Home Prosperity Fund, has acquired more than
                      150 properties in Minneapolis for rehab and resale.
                    • City of Saint Paul has acquired nearly 75 properties for rehab and resale in its Invest Saint Paul areas.
                    • Cities will use Federal Neighborhood Stabilization Funds to acquire, rehabilitate, or demolish vacant
                      and boarded buildings.
                    • City of Duluth created a task force to holistically target market outreach and recovery efforts in heavily
                      impacted older, established neighborhoods.
                    • City of Brooklyn Park has established streamlined, real time communication systems internally and
                      externally in an effort to monitor foreclosed properties. These efforts are identifying vacant homes and
                      proactively preventing significant damage and loss of value from neglect, vandalism, and frozen water pipes.
  Calls to Action   • Enhance partnerships between realtors, utilities, property management companies, landlords and tenants,
                      mortgage servicers, local governments, and community development corporations to better respond to
                      code enforcement and licensing requirements and purchase requests.
                    • Push for enhanced financial literacy and education for the next generation of homeowners.
                    • Develop and provide technical assistance to redevelopment partners.
                    • Provide capacity building support for community development corporations.
                    • Incent and coordinate the rehabilitation and redevelopment efforts of the private market.
                    • Secure funds to acquire, rehabilitate, and resell properties.
                    • Advocate for increased federal resources to stabilize neighborhoods throughout Minnesota.

                    6. Legislative and Legal Strategies
Successes to Date   • Coordinated implementation of landmark, model state legislation passed in 2007 and 2008 to address
                      problems associated with foreclosure, tenant protections, utilities, and predatory lending practices.
                    • Neighborhood organization successfully litigated the acquisition of a key property in North Minneapolis.
                    • City of Minneapolis successfully settled a suit against a challenging property-owning company.
                    • Saint Paul City Attorney’s Office is co-convening a national working group to coordinate municipal legal
                      interests affected by foreclosures.
  Calls to Action   • Address the challenges associated with vacant and boarded buildings.
                    • Support federal legislation that helps address foreclosures.
                    • Require plain language disclosures in contract for deed transactions.
About the Minnesota Foreclosure Partners Council
The goal of the Minnesota Foreclosure Partners Council in Minnesota is to identify, fund, and implement
coordinated statewide policies and programs that effectively address the impact of the recent surge in mortgage
foreclosures on families, neighborhoods, and communities. Members and other partners take specific, innova-
tive, and collaborative actions including changes in policies and practices and the provision of resources.



Partners Required for Success
Minnesota Foreclosure Partners Council                        •   Minnesota Housing
Chairs                                                        •   Ramsey County
Cecile Bedor, City of Saint Paul                              •   Saint Cloud Housing and Redevelopment Authority
Warren Hanson, Greater Minnesota Housing Fund                 •   Three Rivers Community Action
                                                              •   Twin Cities Local Initiatives Support Corporation
Members
• City of Brooklyn Park                                       Other Key Partners
• City of Cottage Grove                                       • Banks
• City of Minneapolis                                         • Community and neighborhood organizations
• City of Saint Paul                                          • Community development corporations
• Dakota County                                               • Elected and public officials
• Dayton’s Bluff Neighborhood Housing Services                • Federal and local housing agencies
• Duluth Local Initiatives Support Corporation                • Federal Reserve Bank of Minneapolis
• Emerging Markets Homeownership Initiative                   • Foundations and private donors
• Family Housing Fund                                         • Housing advocates and tenants organizations
• Fannie Mae                                                  • Legal assistance providers
• Greater Metropolitan Housing Corporation                    • Local governments
• Greater Minnesota Housing Fund                              • Mortgage brokers
• Hennepin County                                             • Mortgage lenders and servicers
• HousingLink                                                 • Realtors
• League of Minnesota Cities                                  • State of Minnesota
 • Metropolitan Consortium of Community Developers            • Trustees of mortgage backed securities
• Minnesota Home Ownership Center                             • University of Minnesota




For the most current version of the Coordinated Plan to Address Foreclosures in Minnesota and partners list,
please visit www.fhfund.org.
                                                                                                                                          RECYCL                                        RECYCL
                                                                                                                                     ON            ED                              ON            ED
                                                                                                                                 D                                             D
                                                                                                                          TE




                                                                                                                                                                        TE




Contact Information
                                                                                                                                                        PA
                                                                                                                      R • PRIN




                                                                                                                                                                    R • PRIN
                                                                                                                                                        PE
                                                                                                                                                         R • PRIN




Twin Cities Metro: Melissa Manderschied, Coordinator of the Minnesota Foreclosure Partners Council,
                                                                                                                       PE




                                                                                                                                                                     PE
                                                                                                                          PA




                                                                                                                                                                        PA
                                                                                                                                                        TE




                                                                                                                                                    D
                                                                                                                                 ED            ON                              ED            ON
                                                                                                                                      RECYCL                                        RECYCL

612.337.9274 or mmanderschied@kennedy-graven.com
Greater Minnesota: Greater Minnesota Housing Fund, 651.221.1997 or toll-free at 1.800.277.2258                        March 2009
                                                                                                                                          RECYCL                                        RECYCL
                                                                                                                                     ON            ED                              ON            ED
                                                                                                                                 D                                             D
                                                                                                                          TE




                                                                                                                                                                        TE
                                                                                                                                                        PA
                                                                                                                      R • PRIN




                                                                                                                                                                    R • PRIN
                                                                                                                                                        PE
                                                                                                                                                         R • PRIN
                                                                                                                       PE




                                                                                                                                                                     PE
                                                                                                                          PA




                                                                                                                                                                        PA
                                                                                                                                                        TE




                                                                                                                                                    D
                                                                                                                                 ED             O                              ED             O
                                                                       Home Prosperity Fund
                                                      Summary for Investors
                                         Raising Social Investment Capital for Affordable
                                               Housing and Neighborhood Revitalization




The Home Prosperity Fund was formed by the Family Housing Fund in the spring of 2007 to foster affordable
housing opportunities in the Twin Cities seven-county metropolitan area by providing long-term, below market
interest rate loans to nonprofit housing organizations.
At present, the primary focus of the Home Prosperity Fund is to address the impact of the mortgage foreclosure
crisis on low- and moderate-income homeowners, renters, and communities. Projects and programs promoting
sustainable and long-term affordable homeownership, as well as acquisition and redevelopment housing efforts in
communities threatened by foreclosure, have been and will be given priority. Other affordable housing programs
and projects may be considered on a selective basis depending on Home Prosperity Fund resource availability.
Organizations who receive funding from the Home Prosperity Fund are considered “Development Partners.”
The Home Prosperity Fund has closed $24 million to date and an additional $1 million is anticipated to close in June.
The initial Home Prosperity Fund investors include Minnesota Housing ($10 million), Wells Fargo Community
Development Corporation ($5 million), US Bancorp Community Development Corporation ($2 million), TCF
National Bank ($1 million), Thrivent Financial Heritage Foundation ($1 million), The McKnight Foundation
($5 million), and the Pohlad Family Foundation ($1 million to close in June). The Home Prosperity Fund is seeking
loans that have terms of ten to 15 years at below market interest rates that are typical with EQ2 loans.

The Home Prosperity Fund Development Partners thus far include:
• Greater Metropolitan Housing Corporation (GMHC) for the acquisition and resale of vacant and/or fore-
  closed properties in North Minneapolis and predevelopment lending for affordable rental housing.
• Dayton’s Bluff Neighborhood Housing Services (DBNHS) for second mortgages for purchasers of single
  family homes in St. Paul neighborhoods—Dayton’s Bluff, Payne/Phalen, Frogtown, and North End—as targeted
  by the City of St. Paul’s Invest Saint Paul initiative.
• GMHC and DBNHS for financing the purchase of vacant and/or foreclosed properties that will be sold to
  homeowners on short-term contract for deeds. Participating homeowners will be required to resolve credit and
  other barriers with the assistance of counseling and then refinance into permanent private market mortgages at
  the end of the contract term.
• Twin Cities Habitat for Humanity (TCHFH) for land acquisition and pre-development activities, primarily in
  the Twin Cities suburbs.
• Minneapolis, St. Paul, Dakota, and Metropolitan public housing authorities in coordination with the
  Fund’s home ownership assistance program for public housing residents or households receiving Section 8 rental
  assistance.
• Model Cities/MCASA for financing purchases of vacant and/or foreclosed properties to be sold using contract-
  for-deed and lease-purchase financing structures to assist and prepare families for stable homeownership.
A Loan Committee consisting of lending professionals from the Home Prosperity Fund investors review and
approve development partner loans. The Family Housing Fund Board is responsible for final approval of all loans.

                                                                                                    continued on back
Investor Benefits
Opportunity to participate in this new collaborative approach to affordable housing and
the mortgage foreclosure crisis
• Leverages private investments with public and philanthropic funds.
• Is managed and administered by a well-established nonprofit, the Family Housing Fund.
• Provides financing to leading affordable housing organizations.

One investment offers the opportunity to benefit multiple organizations. The Home Prosperity Fund will provide
quarterly reports to our lenders on the impact their investments are having on our communities.
Investor risk is mitigated by the diversification of Home Prosperity Fund loan portfolio in multiple well-established
organizations with multiple geographic and program service areas.

Professional management and administration provided by the Family Housing Fund and
the Home Prosperity Fund Loan Committee
The Loan Committee includes lending professionals from our investors:
• Paul Binder, Director, Loan Servicing and Closing, Thrivent Financial for Lutherans
• William Canfield, Vice President of Community Development and Special Lending, Wells Fargo Bank
  Minneapolis, National Association
• Charles Hanley, District Manager, U.S. Bank, National Association
• Katy Lindblad, Assistant Commissioner of Community Development, Minnesota Housing
• William Sarvela, Vice President, Community Reinvestment Act Officer, TCF Bank

Security
The investor loan to the Family Housing Fund is recourse. The Home Prosperity Fund loans to the Development
Partners are recourse and/or secured by the underlying home and land inventory, credit enhancements, and other
project-related assets, depending on the project.

Specific benefits for banks: Community Reinvestment Act (CRA) Credit
Our bank investment partners have been advised that their loans can be categorized as “EQ2” loans that allow the
banks to claim CRA credit.


Home Prosperity Fund Contact Information
To explore investment opportunities or for more information, please contact:
Lowell Yost                                             Carol Kelleher
Program Director, Family Housing Fund                   Consultant, Home Prosperity Fund

Email   lyost@fhfund.org                                Email    kelleherca@gmail.com
Phone (612) 375-9644, ext. 19                           Phone (952) 922-7538
Fax     (612) 375-9648                                  Cell     (612) 716-2360
                                                        Fax      (612) 375-9648




The Family Housing Fund is a nonprofit organization whose mission is to provide safe, affordable, sustain-
able homes to families and children in the Twin Cities metropolitan area through ongoing partnerships
with the public and private sector. Learn more at www.fhfund.org.                             May 2009
The Twin Cities Community Land Bank is a nonprofit
organization that was formed by the Family Housing
Fund as a strategic tool for government, neighborhood based organizations,
community development corporations, and nonprofit and for profit developers
to further community-based economic development and affordable housing
goals. The Fund and its public/private partners have designed and implemented
this highly innovative tool to respond quickly and effectively to the challenges
and opportunities of the foreclosure crisis and to further regional growth
objectives linking housing, jobs, transportation, and education.




Building Neighborhoods, Strengthening Communities
The Twin Cities Community Land Bank is designed to operate on a large scale and over a broad geographic
area, including the cities of Minneapolis and Saint Paul and the surrounding cities and counties in the seven-
county metropolitan area. The Land Bank will coordinate across multiple sectors of interest and takes both
an immediate and long-term view toward the development and re-building of communities.

The Land Bank will coordinate housing policies and programs with broader community development
objectives, including jobs, economic opportunities, transportation, public safety, schools, human services,
green building and design, and homeownership counseling and support. As a nonprofit limited liability
company, it is designed to be highly flexible and responsive and is able to leverage additional public and
private dollars to accomplish the goals of neighborhood stabilization and recovery.

$30 million Committed to Support Neighborhood Revitalization Efforts
The Twin Cities Community Land Bank has raised and committed $30 million to advance neighborhood
recovery in the Twin Cities metropolitan area. While this funding has been allocated across the metro-
politan area, it has been concentrated in specific neighborhoods to spur transformative change through
a concentration of resources and support. Twin Cities Community Land Bank’s funds will be used for
property acquisition, rehabilitation/redevelopment, and holding costs for properties that are banked for
varying terms based on market absorption.

Creating Sustainable Homeownership and Rental Opportunities
Maximizing Neighborhood Stabilization Program Investments in the Community
As a part of the national Neighborhood Stabilization Program (NSP), Twin Cities Community Land Bank
intends to purchase for its public and private partners, 2000 residential properties and parcels in targeted
communities, with the goal of rehab or redevelopment of the properties and creating sustainable home-
ownership or rental opportunities for individuals and families. Twin Cities Community Land Bank will be an
interim acquisition lender for its public and private partners that are NSP1 grantees/sub grantees and NSP2
applicants—advancing funds to allow its partners to respond quickly and strategically to acquisition and
redevelopment opportunities. The Land Bank will also act as a lender to developers undertaking rehabili-
tation and new construction. Finally, Twin Cities Community Land Bank will provide additional community
services to address barriers to community revitalization, such as developing creative homeownership
financial products and coordinated neighborhood marketing.
Enhancing the National Community Stabilization Trust’s First Look and Aged/Targeted Bulk
Purchase Programs
The National Community Stabilization Trust’s (NCST) groundbreaking REO acquisition program, also
known as First Look and Aged /Targeted Bulk Purchase, was launched in the Twin Cities metropolitan
area—attesting to the Twin Cities’ highly regarded, coordinated, and effective community approach to
the foreclosure crisis. The NCST First Look program provides an efficient and cost effective mechanism
for transferring vacant and foreclosed properties directly from banks and servicers to approved buyers
at an adjusted and highly favorable price before properties go on the open market. The Aged /Targeted
Bulk Purchase program provides an opportunity to purchase clustered properties, thus magnifying the
opportunity to significantly improve a neighborhood. Two nonprofit organizations (Greater Metropolitan
Housing Corporation and Dayton’s Bluff Neighborhood Housing Services) have been managing this
program in the Twin Cities on a pilot basis. As of September 1, 2009, the Twin Cities Community Land Bank
assumed the role of manager of the NCST program in Minneapolis and Hennepin County. After allocation
of NSP2 awards, Twin Cities Community Land Bank will expand its management of the NCST program
metro-wide.



Twin Cities Community Land Bank Guiding Principles
The Twin Cities Community Land Bank works with its public, private, nonprofit, and community partners
with the ultimate goal of supporting the creation of vibrant, sustainable homes, neighborhoods, and
communities throughout the Twin Cities metropolitan area. In order to achieve this goal, the Twin Cities
Community Land Bank is guided by the following eight main principles.

1. Enable the efficient, effective holding and marketing of properties acquired through various
   neighborhood recovery efforts.

2. Reduce the public cost of holding land through efficiencies of coordination and scale.

3. Efficiently and creatively aggregate capital to support a large scale land acquisition, disposition,
   and marketing effort.

4. Provide opportunities for community and neighborhood engagement in the development of
   foreclosed properties, particularly among communities of color.

5. Promote best practices in planning and design, including high architectural standards, energy
   efficiency, green land and construction standards, and housing development to transportation linkages.

6. Coordinate housing policies and programs with broader community development objectives, including
   jobs, economic opportunities, transportation, public safety, schools, human services, and homeowner-
   ship counseling and support—particularly among communities of color.

7. Provide affordable, sustainable homeownership opportunities for low and moderate-income families
   while reducing the disparity between homeownership rates for whites and communities of color.

8. Provide business and contracting opportunities for communities of color.




Contact
Rebecca L. Rom                            PH  612-238-8210
Twin Cities Community Land Bank           FAX 612-238-8219

615 First Avenue NE, Suite 410            WEB www.tcclandbank.org
Minneapolis, Minnesota 55413              E becky.rom@tcclandbank.org




                                                   Twin Cities Community Land Bank LLC is a subsidiary of the Family Housing Fund

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:2
posted:11/15/2011
language:English
pages:20