Shenandoah Valley Housing Organizations Receive $10.1 Million in Financing to Address Housing Needs

Five Shenandoah Valley 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 $10.1 million in low-interest financing to these groups to finance affordable homes in the Shenandoah Valley of 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 Shenandoah Valley organizations that received SPARC allocations and the programs they designed for the funding:

Central Shenandoah Planning District Commission has been awarded an allocation of $1.9 million to assist borrowers purchasing existing homes within Augusta, Bath, Highland, Rockbridge and Rockingham areas. HOME funds will be available for downpayment and closing cost assistance.

Hope Community Builders has been awarded an allocation of $1.5 million to construct new, affordable homes in the Harrisonburg neighborhood of Covenant Heights. Homes will be energy efficient and Earthcraft certified. Existing homes in the City of Harrisonburg, Rockingham county and vicinity will also be eligible for financing. HOME funds will be available for downpayment and closing cost assistance.

Milstead Construction has been awarded an allocation of $1 million to assist borrowers purchasing new townhomes in the Park Place subdivision in Grottoes. Townhomes are discounted by $7,000 to $10,000. HOME funds will be available for downpayment and closing costs assistance.

Piedmont Housing Alliance has been awarded an allocation of $5 million to assist borrowers purchasing new and existing homes in the City of Charlottesville, Albemarle and Nelson Counties. New homes will meet both Energy Star and visitability standards. HOME funds will be available for downpayment and closing cost assistance.

Waynesboro Redevelopment and Housing Authority has been awarded $700,000 to assist the development of a Waynesboro subdivision at the intersection of Third Street and Jackson Avenue. HOME funds will be available for downpayment and closing cost assistance. Housing Choice Vouchers will also be accepted to assist very-low income homebuyers.

“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.