Multi-Family Housing Loan Guarantees

PROGRAM STATUS:

Open

APPLICATION DEADLINE:

December 31, 2021, 12:00 p.m. Eastern Time

What does this program do?
The program works with qualified private-sector lenders to provide financing to qualified borrowers to increase the supply of affordable rental housing for low- and moderate-income individuals and families in eligible rural areas and towns.

Who may apply for this program?
Private lenders may apply for a loan guarantee on loans made to eligible borrowers who are building or preserving affordable rural rental housing. 

Eligible lenders are automatically eligible if approved and active in one of the following programs:

  • Fannie Mae, Freddie Mac, Ginnie Mae
  • HUD
  • Federal Home Loan Bank members
  • State or local housing finance agencies

Eligible borrowers include:

  • Most state and local governmental entities
  • Nonprofit organizations
  • For-profit organizations, including LLC's
  • Federally-recognized Tribes

Additional requirements include:

  • Rent for individual units is capped at 30% of 115% area median income
  • Average rent for an entire project (including tenant paid utilities) cannot exceed 30% of 100% of area medium income, adjusted for family size.
  • Complexes must consist of at least five units
  • Complexes may contain units that are detached, semi-detached, row houses or multi-family structures

What is an eligible area?
Areas that may be served include:

How may funds be used?
Construction, improvement and purchase of multi-family rental housing for low to moderate income families and individuals is the primary objective for this program. Funding may also be available for:

  • Buying and improving land
  • Providing necessary infrastructure
  • For a complete list see Code of Federal Regulations, 7CFR Part 3565.205

What are the terms of a loan guarantee?

  • The Agency offers guarantees of up to 90% of the loan amount
  • For-profit entities may borrow up to  90% and non-profit entities may borrow up to 97% of the total development cost or appraised value, whichever is less
  • Minimum term of 25 years and maximum term of 40 years
  • Interest rate negotiated between the lender and the borrower is fixed for the life of the loan guarantee

Who will service the loan?
Loans guaranteed through this program are serviced through the private lender that makes the loan, just as they would be without a guarantee.

Who may live in the rental housing?
Low- to moderate- income families or individuals (1)

Is there a list of qualified private lenders in my area?
For questions, contact your designated regional coordinator listed on the Contact tab.

How do we get started?
Applications for this program are accepted on an annual basis. A Notice of Funding Availability (NOFA) is posted in the Federal Register

Who can answer questions?
Find a regional contact on the Contact tab or you can find Rural Rental Properties here to apply as a tenant.

What governs this program?

NOTE: Because citations and other information may be subject to change please always consult the program instructions listed in the section above titled "What Law Governs this Program?" For questions, contact your designated coordinator listed on the Contact tab.

(1) Low to moderate income: At initial occupancy, tenants' income cannot exceed 115% of the area median income adjusted for family size.

 

NOSA Response Form (pdf).  Use this electronic Response Form to submit a pre-application for the Section 538 Guaranteed Rural Rental Housing NOSA published on December 21, 2017. Ending date: December 31, 2021 at 12:00 noon Eastern Time.

MFH GovDelivery Subscription Link - Sign up to receive emails on MFH announcements.

Individual states may have particular requirements based on state and local regulations. For questions, contact your designated regional coordinator listed on the Contact tab.

Individual states may have particular requirements based on state and local regulations. For questions, contact your designated regional coordinator listed on the Contact tab.

Rural Development environmental requirements can be found here: RD 1970 Environmental Policies and Procedures. Benefits of the 1970 environmental regulations are described here: 7 CFR 1970 Benefits.

There are no other additional requirements at the national level. If there are additional state-specific requirements they will be listed above.

There are currently no events scheduled.

On October 11, 2020 Rural Development’s Multifamily Housing Program finalized its structural realignment which, in some cases, redistributed the existing portfolio to a servicing Specialist within our new Field Operations Division. If you are looking for the servicing Specialist for a specific property, you will find a complete and sortable list here: https://www.sc.egov.usda.gov/data/MFH.html

Our Field Operations Division maintains local relationships through regionally organized servicing teams and handles all day-today servicing of Multifamily housing properties to ensure that tenants have safe and affordable housing. The four regions and the contact information for each Regional Director follows:

Becki Meyer, Regional Director, Western Region Becki.meyer@usda.gov
(AK, AZ, CA, CO, HI, ID, MT, NM, NV, OR, UT, WA, WY)

Byron Waters, Regional Director, Southern Region Byron.waters@usda.gov
(AL, AR, FL, GA, KY, LA, MS, NC, OK, PR, SC, TN, TX, VI)

Karissa Stiers, Regional Director, Midwest Region Karissa.stiers@usda.gov
(IA, IL, IN, KS, MI, MN, MO, ND, NE, OH, SD, WI)

Laurie Warzinski, Regional Director, Northeast Region Laurie.warzinski@usda.gov
(CT, DE, MA, MD, ME, NH, NJ, NY, PA, RI, VA, VT, WV)

If you need information on a loan transaction currently in process, or have questions on a new transaction, our Production & Preservation Division (PPD) processes, underwrites, and closes all multifamily direct, preservation, and guaranteed loan transactions. PPD will support all the Multifamily Housing Programs, including 515, 538, Multifamily Preservation and Revitalization (MPR), prepayments, and preservation efforts. This division will also oversee Notice of Solicitation of Applications (NOSA) drafting and administration efforts for Farm Labor Housing, Housing Preservation Grants, MPR, technical assistance, and 515. The email contact information for the Production & Preservation Division follows:

Processing and Report Review BranchMFHprocessing1@usda.gov
(CT, DE, IA, IL, IN, KS, MA, MD, ME, MI, MN, MO, ND, NE, NH, NJ, NY, OH, PA, RI, SD, VA, VT, WI, WV)

Processing and Report Review Branch 2
MFHprocessing2@usda.gov
(AK, AL, AR, AZ, CA, CO, FL, GA, HI, ID, KY, LA, MS, MT, NC, NM, NV, OK, OR, PR, SC, TN, TX, UT, VI, WA, WY)