Oregon Housing and Community Services (OHCS) has established a permanent loan program aimed at helping affordable rental housing developments move from construction to completion.
“If you were to ask most people across the country what their top concerns are, most would define them by the cost of living,” says OHCS executive director Andrea Bell. “For too many, it’s keeping them up at night—a home they can afford alongside groceries, gas, and childcare. This program is another way we deliver advanced housing solutions that help make life better.”
The launch of this reimagined program, which provides direct loans from the state, marks the first time in almost two decades the agency will directly finance long-term mortgages for affordable rental housing development.
Unlike construction financing, permanent loans fund long-term mortgages with proceeds from tax-exempt bonds once a property is stable and operational. The program includes two products: Elderly and Disabled (E&D) bonds, which serve older adults and people with disabilities, and Department of Housing and Urban Development (HUD) Risk Share, which supports households with low incomes.
OHCS previously issued $589 million in E&D bonds, supporting 355 developments and more than 7,000 units, before pausing permanent lending around 2007 due to market conditions and low interest rates. With growing financing gaps in the market and new legislative direction via Senate Bill 684, the agency has modernized the program with enhanced underwriting and other changes.
The loan can be used with low-income housing tax credits, local innovation fast track, and other programs.
The minimum loan size is $3 million, with smaller loans considered on a case-by-case basis. The minimum loan-to-value is the lesser of 90% of the project’s improved restricted appraised value or 95% of total project development costs.
The terms include up to 40-year amortization, with 17- or 30-year balloons available.
More details can be found here.