Neighborhood Stabilization Loan Fund

The Neighborhood Stabilization Loan Fund targets $17 million from private lenders and $3 million from private, non-profit foundations to support the acquisition of properties in neighborhoods hard-hit by foreclosures.

The Patrick Administration and the state Department of Housing and Community Development are supporting this initiative with $1 million, which will serve as a loan loss reserve, a crucial safety net for the loan fund.

The financing is available to non-profit and for-profit developers who are investing in lower-income neighborhoods that are part of a targeted municipal stabilization effort.

The loan fund is designed to help qualified buyers quickly purchase and hold properties while financing is obtained to stabilize properties long-term. To achieve this, the loan fund has been has been structured in two tiers:

• Acquisition fund: Revolving lines of credit of $250,000 to $1 million to each organization, based on the borrower's strength and stabilization plan. This will enable borrowers to move quickly in the marketplace to purchase qualified properties.
• Holding pool fund: Once acquired, loans will be moved into this holding pool, where they will be reviewed and considered for loans to support rehabilitation and long-term stabilization.
• To review the Neighborhood Stabilization Loan Fund term sheet, click here.

The Massachusetts Housing Partnership and the Massachusetts Housing Investment Corp. are combining to provide $17 million from their bank-funded loan pools. An additional $3 million is being provided by the Boston Foundation and the Hyams Foundation. Living Cities, a New York-based non-profit, is providing a $500,000 grant.

The loan fund is being administered by the Massachusetts Housing Investment Corp. For more information, contact Bruce Ehrlich at 617-850-1040 or ehrlich@mhic.com.