Efforts to increase access to affordable lending products got a boost recently when 19 members of the NeighborWorks network received over $16.9 million as part of grants made by the U.S. Department of the Treasury’s Community Development Financial Institution program. Combined with grants from NeighborWorks America, local governments, foundations and the private sector, these small- and medium-sized nonprofit businesses continue to lend in their local communities, and provide access to affordable loan products and services to low- and moderate-income borrowers.
“CDFI funds play a critical role in the NeighborWorks network’s efforts to create strong communities and sustainable affordable housing,” said Eileen Fitzgerald, CEO of NeighborWorks America. “They offer appropriate lending products to low and moderate income homebuyers and local businesses at a time when other financial institutions have limited products available.”
The CDFI funding awarded this year will enable nonprofits like Midwest Minnesota Community Development Corporation of Detroit Lakes, Minn., to add capital to its first- and second-affordable mortgage loan pool, which will help low-income households purchase affordable single-family homes. CDFI funds will also enable the National Council on Agricultural Life and Labor Research Fund in Dover, Del., to increase lending in five distressed counties in its service area. And finally, CDFI funding will enable the Honolulu HomeOwnership Center to make down payment assistance loans and capitalize a loan loss guarantee fund.
In addition to the 19 grant recipients in this latest round of financing, there are 73 other NeighborWorks organizations with certified CDFI operations. NeighborWorks organizations use these recent CDFI grants and prior grants to increase access to credit in a variety of ways, including:
- Provide down payment assistance to qualified first-time homebuyers who have successfully completed homeownership education classes
- Provide capital to support the construction and project management of affordable homes for sale
- Provide capital to support business loan products