Multifamily Lending Program

  • Multifamily Lending Program

The Multifamily Lending Program (MLP) provides long-term, permanent financing for multifamily rental housing developments that serve low- to moderate-income residents. It is ineligible to be used during construction. For proposed MLP loans that do not involve Low-Income Housing Tax Credits (LIHTC), developers/owners that are new to OHFA must partner with an organization with whom OHFA has an established and satisfactory relationship.

Rent and income restrictions that mirror the LIHTC program are required during the term of the loan. All other LIHTC compliance monitoring rules also apply. Strong preference will be given to organizations with considerable and successful experience with OHFA programs and that have sufficient staff capacity, substantial financial resources and an excellent credit history.


Loan Categories

There are three loan categories under the MLP:

  • New LIHTC MLP loans, which work in conjunction with the LIHTC program by coupling the MLP with projects receiving a new allocation of 4% or 9% tax credits, for both new construction/adaptive reuse and the rehabilitation of existing units. New LIHTC loans cannot be paired with lease purchase developments.
  • Existing LIHTC MLP loans, which are targeted toward existing developments previously funded under the LIHTC program and are between Year 10 and Year 20 of their compliance or extended use period, have minimal capital needs and no uncorrected non-compliance issues. These loans are intended for developments that would benefit from refinancing/restructuring their existing debt/partnership obligations, and would remain affordable for the balance of their Extended Use periods. Any significant capital needs identified in the Capital Needs Assessment must be addressed to OHFA's satisfaction prior to closing.
  • Choice MLP loans, which are directed toward unique developments that help to meet OHFA's goals in achieving its affordable housing policy objections, but are not coupled with the LIHTC program.

Available Funding

Available funding comes from OHFA reserves and recycled Tax Credit Assistance Program (R-TCAP) funds. MLP may be used in conjunction with the following programs:

The MLP is ineligible to be coupled with the Housing Development Gap Financing program. If the MLP is used in conjunction with housing credits and the Housing Development Loan (HDL) Program, the only acceptable source of collateral for the HDL after construction is Qualified Investor Notes.


Program Guidelines


Terms

  • The maximum loan amount is $3 million. Exceptions may be permitted, contingent on approval by the OHFA board.
  • Organizations are limited to $6 million in total loan funding and three loans per fiscal year. Exceptions may be permitted based on available funding capacity and are contingent on approval by the OHFA board.
  • Interest Rate: New LIHTC MLP: Maximum of 4.25 to 4.75%, based on the needs and risk factors for each loan. This rate will apply to New LIHTC projects that apply for MLP funding during calendar year 2018 only. Non-Recourse. Existing LIHTC MLP: 10 Year Treasury Rate + 3%. Recourse debt, requires a corporate guarantee. Choice MLP: 10 Year Treasury + 3%. Recourse debt, requires a corporate guarantee. An additional risk premium may be added based on OHFA's evaluation of project risk and collateral.
  • Forward Commitments: MLP loans are rate-locked at the time of Board approval, which may occur long before the loan is ready to close.
  • Term and Use Restriction Period: Up to 17 years. MLP loans funded with R-TCAP require a 15-year use restriction period.
  • The amortization period is up to 30 years.
  • Maximum LTV: Up to 85% percent loan to value (LTV) for New LIHTC MLP and Existing LIHTC MLP loans, based on OHFA's evaluation of risk and collateral. Exceptions may be permitted for Choice MLP loans with additional collateral, contingent on approval by the OHFA board.

Contact Information

Questions and correspondence regarding the MLP may be directed to:

Kelan Craig
Development Division
Ohio Housing Finance Agency
57 East Main Street
Columbus, Ohio 43215