Northern Virginia Housing Organizations Receive $70.4 Million in Financing to Address Housing Needs

Thirteen Northern Virginia housing organizations are receiving good news and much needed funding for first-time homebuyers. The Virginia Housing Development Authority recently announced that it is allocating $70.4 million in low-interest financing to these groups to finance affordable homes in Northern Virginia.

The allocations are funded through VHDA’s Sponsoring Partnerships and Revitalizing Communities (SPARC) program, which provides home loans to potential homebuyers through local governments, non-profit organizations, developers and redevelopment and housing authorities. The organizations then combine a variety of local, state and federal loan and grant programs to design a variety of financing options that meet the needs of buyers in their specific communities. Organizations that received SPARC funding are eligible to receive allocations at an interest rate of 1/2 to 1 percent below VHDA’s rate for first-time homebuyer programs.

In addition to providing customized home financing programs, SPARC funds also support VHDA’s strategic initiatives, including community revitalization and addressing the housing needs of seniors, minorities and those with disabilities.

Below is an overview of the Northern Virginia organizations that received SPARC allocations and the programs they designed for the funding:

Arlington Housing Corporation (AHC) has been awarded an allocation of $2.5 million to assist borrowers purchasing new affordable condominiums located in the Nauck neighborhood of South Arlington. The condominiums in the development, 17th Street Condominium, will sell for approximately $150,000 below current market prices of similar units. Moderate Income Purchase Assistance Program (MIPAP) funds of approximately $25,000 will be available to eligible borrowers for downpayment and closing costs assistance.

Arlington County Government has been awarded an allocation of $15 million to assist borrowers purchasing market rate homes, subsidized affordable dwelling units (ADUs) and those participating in the Employer Assisted Housing Initiative. Arlington County is providing $2 million in subsidies for downpayment/closing costs, second mortgages and discounted sales prices.

Blue Ridge Housing Network has been awarded an allocation of $2 million to assist borrowers purchasing newly constructed townhomes in Stephens City or existing homes in the Blue Ridge Housing service area. In addition, downpayment and closing cost assistance will be available through the HOMEownership Down Payment Assistance Program.

Catholics for Housing (CFH) has been awarded an allocation of $1 million to assist borrowers purchasing new affordable town homes on acreage owned by CFH in Bristow. Town homes are discounted by over $100,000 to ensure affordability to the Prince William County workforce.

Central Virginia Housing Coalition has been awarded an allocation of $2.5 million to assist borrowers purchasing newly constructed townhomes and existing single family detached homes in Caroline, Orange and Spotsylvania Counties. HOME funds will be available for downpayment to eliminate the need for mortgage insurance and builders will provide funds for closing cost assistance.

City of Alexandria has been awarded an allocation of $15 million to finance homes throughout the city. Income eligible borrowers may receive up to $50,000 in second trust financing through the HAP program or $30,000 through the City’s Moderate Income Homeownership Program (MIHP). Federal Home Loan Bank (FHLB) and Individual Development Account Funds (IDA) will also be utilized to increase home affordability.

City of Falls Church has been awarded an allocation of $1.5 million to assist borrowers purchasing new Affordable Dwelling Units (ADUs) that will be located in the Spectrum and Pearson Square Condominiums. The ADU’s sales prices will range from $99,000 to $146,000. Existing condominiums located in Park Towers, Falls Plaza, The Madison, Falls Chase and the Byron are also eligible for VHDA’s SPARC financing. In addition, downpayment and closing cost assistance will be available.

City of Manassas Trust Fund has been awarded an allocation of $2 million to finance existing properties in the City of Manassas. City of Manassas Trust Fund will provide downpayment and closing cost assistance utilizing HOME, Community Development Block Grants (CDBG) and American Dream Downpayment Initiative (ADDI) funds.

City of Winchester has been awarded an allocation of $1 million to assist borrowers in purchasing existing renovated homes located in the South Kent Street Revitalization area. Funds will also support the City of Winchester Employer Assisted Housing Program providing downpayment and closing cost assistance to City employees.

Fairfax County Redevelopment and Housing Authority has been awarded an allocation of $15 million to help borrowers purchase ADUs or existing market rate units. Fairfax’s First-Time Homebuyers Program, Homebuyer Equity Loan Program (HELP) and ADDI funds provide downpayment, closing cost assistance and gap financing.

Fauquier County has been awarded an allocation of $1 million to assist borrowers in purchasing newly constructed townhouses at Waverly Station, a development in Bealeton. The county will also provide forgivable loans assisting with downpayment and closing costs.

Loudoun County Dept. of Family Services has been awarded a total allocation of $7.5 million. An allocation of $6 million will help borrowers purchasing new and existing townhouse and condominium ADUs and an allocation of $1.5 million will assist borrowers purchasing new or existing homes throughout the County. Loudon County will offer downpayment and closing costs assistance repayable over 10 years at an interest rate of three percent.

Prince William County has been awarded an allocation of $4.4 million to assist first time homebuyers who live or work in Prince William County to purchase existing homes in the county. Prince William County will offer downpayment assistance of between $75,000 and $85,000 and provide up to six percent of a borrower’s closing costs.

“We developed the SPARC program so that our housing partners could bring us customized programs that generally are not available from private lenders or through VHDA’s regular lending programs,” said Don Ritenour, VHDA’s managing director of development. “Our partners have the knowledge and direct insight into the unmet needs in their communities. They are in the best position to design programs that combine their local, state and federal funding with our SPARC monies to make every dollar count.”

Organizations submitted proposals to VHDA in April 2007. All proposals underwent an initial eligibility review and a subsequent competitive review process.

In addition to addressing local needs, the proposals needed to support some or all of VHDA’s homeownership goals including: helping provide loans to low-income households, diverse cultures, minority populations and persons with disabilities; encouraging the construction or rehabilitation of homes for accessibility and overall quality improvements; revitalizing communities; and meeting housing needs not met by traditional lenders.

Proposals that significantly support VHDA’s business goals received an allocation of funds at an interest rate of 1 percent below the rate for VHDA’s first-time homebuyer loan program, which at today’s rate would be 5.125 percent. Other allocations had an interest rate of ½ percent below VHDA’s first-time homebuyer rate. Exact rates are determined at the time of actual loan reservation.

VHDA’s SPARC program has awarded more than $730 million to housing organizations to encourage homeownership throughout Virginia since the program was created five years ago.

For more information about the SPARC program, contact one of the organizations listed above. Information can also be found on VHDA’s Web site at www.vhda.com or by calling 1-877-VHDA-123.

VHDA is Virginia’s housing finance agency. It is a self-supporting authority that issues bonds to raise private capital for its lending programs. VHDA provides consumers with low-interest rate loans to purchase or renovate homes. VHDA also lends money to developers for the development, rehabilitation and renovation of affordable apartments.