Grant Funding & Administration Journal: HUD 1. The Section 1. 08 Loan Guarantee Program is a source of financing alotted for the economic development, housing rehabilitation, public facilities rehab, construction or installation for the benefit of low- to moderate- income persons, or to aid in the prevention of slums. Introduction. Section 1.
Community Development Block Grant (CDBG) program. Section 1. 08 provides communities with a source of financing for economic development, housing rehabilitation, public facilities, and large- scale physical development projects. This makes it one of the most potent and important public investment tools that HUD offers to local governments. It allows them to transform a small portion of their CDBG funds into federally guaranteed loans large enough to pursue physical and economic revitalization projects that can renew entire neighborhoods. Such public investment is often needed to inspire private economic activity, providing the initial resources or simply the confidence that private firms and individuals may need to invest in distressed areas. Section 1. 08 loans are not risk- free, however; local governments borrowing funds guaranteed by Section 1. CDBG allocations to cover the loan amount as security for the loan.
Regulations are found in 24 CFR 570.700 The section 108 Loan Guarantee program differs from traditional HUD development. HUD must approve all Section 108.
CITY OF DALLAS COMMUNITY DEVELOPMENT BLOCK GRANT SECTION 108 LOAN GUARANTEE PROGRAM. Detailed Information on the Section 108 Community Development Loan Guarantee Program. Section 108 Community Development Loan Guarantee. 108 program, HUD has. Section 108 Loan Guarantee Program. Repayment: The maximum repayment period for a Section 108 loan is twenty years. Section 108 Loan Guarantees. The Section 108 loan guarantee program has.
Regulations governing the Section 1. CFR 5. 70, Subpart M, Loan Guarantees. Eligible Applicants.
Eligible applicants include the following public entities: metropolitan cities and urban counties (i. CDBG entitlement recipients); nonentitlement communities that are assisted in the submission of applications by States that administer the CDBG program; andnonentitlement communities eligible to receive CDBG funds under the HUD- Administered Small Cities CDBG program (Hawaii). The public entity may be the borrower or it may designate a public agency as the borrower. Eligible Activities.
Activities eligible for Section 1. CDBG; acquisition of real property; rehabilitation of publicly owned real property; housing rehabilitation eligible under CDBG; construction, reconstruction, or installation of public facilities (including street, sidewalk, and other site improvements); related relocation, clearance, and site improvements; payment of interest on the guaranteed loan and issuance costs of public offerings; debt service reserves; public works and site improvements in colonias; andin limited circumstances, housing construction as part of community economic development, Housing Development Grant, or Nehemiah Housing Opportunity Grant programs. For purposes of determining eligibility, the CDBG rules and requirements apply. As with the CDBG program, all projects and activities must either principally benefit low- and moderate- income persons, aid in the elimination or prevention of slums and blight, or meet urgent needs of the community. Maximum Commitment Amount. Commitments are limited as follows: Entitlement public entities. An entitlement public entity may apply for up to five times the public entity's latest approved CDBG entitlement amount, minus any outstanding Section 1.
Section 1. 08 loans. State assisted public entities.
- 2010 Section 108 Guaranteed Loan Program. 82% Section 108 loan guarantee.
- Summary information for the funding program Section 108 Loan Guarantee Program. Interested applicants should contact the local HUD office to begin the.
- HUD 108 program Section 108 Loan. Section 108 is the loan guarantee. The maximum repayment period for a Section 108 loan is twenty years.
- Municipality of Toa Alta, PR. Toa Alta’s Section 108 Loan Guarantee program. Municipality of Toa Alta’s Section 108 Loan.
A nonentitlement public entity may apply for up to five times the latest approved CDBG amount received by its State, minus any outstanding Section 1. Section 1. 08 loans for which the State has pledged its CDBG funds as security. Nonentitlement public entities eligible under the HUD administered Small Cities Program.
For a public entity in Hawaii, the maximum commitment amount is five times the public entity's latest grant under 2. CFR 5. 70, Subpart F, minus any outstanding Section 1.
Section 1. 08 loans. Loan Details. Security: The principal security for the loan guarantee is a pledge by the applicant public entity or the State (in the case of a nonentitlement public entity) of its current and future CDBG funds. Additional security will also be required to assure repayment of guaranteed obligations. The additional security requirements will be determined on a case- by- case basis, but could include assets financed by the guaranteed loan.
Repayment: The maximum repayment period for a Section 1. HUD has the ability to structure the principal amortization to match the needs of the project and borrower.
Each annual principal amount will have a separate interest rate associated with it. Financing Source: Section 1. Financing between public offerings is provided through an interim lending facility established by HUD. Interest Rates: Interest rates on interim borrowing are priced at the 3 month London Interbank Offered (LIBO) rate plus 2.
Permanent financing is pegged to yields on U. S. Treasury obligations of similar maturity to the principal amount. A small additional basis point spread, depending on maturity, will be added to the Treasury yield to determine the actual rate. Default: To date, there has been no default under Section 1.
HUD. In the event of default requiring a payment, HUD would continue to make payments on the loan in accordance with its terms. The source of payments by HUD pursuant to its guarantee would almost always be pledged CDBG funds. However, HUD does have borrowing authority with the U. S. Treasury if the pledged funds are insufficient.