The United States Department of Agriculture (USDA) Rural Development is accepting proposals for fiscal year 2016 funding of $150 million under the Section 538 Guaranteed Rural Rental Housing (GRRH) loan program. GRRH loans help build and maintain affordable multi-family housing rental complexes in rural areas.
Through the GRRH program, eligible lenders provide loans to potential applicants, such as nonprofit corporations, public bodies, for-profit organizations and Federally-recognized tribes for the development of affordable rental housing.
Qualifying properties include new construction and the acquisition of existing structures with rehabilitation. Existing Section 515 Direct Rural Rental Housing financed properties and Section 514 Farm Labor Housing can also utilize GRRH loans for revitalization, repairs, and costs involved in transfer of ownership. A minimum of $6,500 per unit of needed repairs and/or revitalization must be shown.
Rural Development may provide a maximum 90 percent guarantee on unpaid principal and interest of loans for for-profit entities and 97 percent for non-profit entities. The minimum term is 25 years with a maximum term of 40 years. The interest rate is negotiated between the lender and the borrower and is fixed for the life of the loan.
Lenders are invited to submit proposals in the form of a “Section 538 Notice of Solicitation of Applications (NOSA) Response” either electronically using the Section 538 electronic response form found at: http://www.rd.usda.gov/programs-services/multi-family-housing-loan-guarantees or in hard copy to USDA Rural Development, Attn: Terri Kostal, Rural Housing Division; Federal Building Suite 308; 100 Centennial Mall North; Lincoln, Nebraska 68508. Submission of the electronic Section 538 NOSA response form does not constitute submission of the entire application package. Selected responses that develop into complete applications and meet all Federal eligibility requirements prior to September 30, 2016, will receive conditional commitments until all FY 2016 funds are expended. Selected responses that are deemed eligible after September 30, 2016 will be funded to the extent funding is available. Eligible responses will be accepted through December 31, 2017, 12 p.m. ET. Those interested in submitting an application for funding under this program are encouraged to consult the Rural Development web site http://www.rd.usda.gov/ programs-services/multi-family-housing-loan-guarantees periodically for updated information regarding the status of funding for this program.
Contact Terri Kostal, (402) 437-5557 or terri.kostal@ne.usda.gov. To view the NOSA, see page 13311 of the March 14, 2016 Federal Register, or visit https://www.gpo.gov/fdsys/pkg/FR-2016-03-14/pdf/2016-05610.pdf.
President Obama’s plan for rural America has brought about historic investment and resulted in stronger rural communities. Under the President’s leadership, these investments in housing, community facilities, businesses and infrastructure have empowered rural America to continue leading the way – strengthening America’s economy, small towns and rural communities. USDA’s investments in rural communities support the rural way of life that stands as the backbone of our American values.