The Greater New Haven Community Loan Fund is a certified Community Development Financial Institution (CDFI), a flexible source of alternative financing for affordable housing developers and nonprofit organizations.Through its lending and investment, the Fund's mission is to create and sustain vibrant neighborhoods and communities.
The primary service area footprint is New Haven and the surrounding county, however, lending for affordable housing development in other Connecticut municipalities is also available. The Fund has made successful loans in Ansonia, Branford, Bridgeport, Derby, Guilford, North Haven, Meriden, Madison, Milford, Middletown and Waterbury.
GNHCLF makes flexible loans to affordable housing developers and non-profits. Affordable housing lending activities describe the majority (75%) of our work during 2014. Our current ($6.5M) loan portfolio features loans ranging from $25,000 to $1M to 22 housing developers. Desired projects encompass many types of affordable housing options including affordable rental, supportive housing, mutual housing, cooperatives and home-ownership. Loans may be for acquisition, bridge funding, construction/rehabilitation financing, or mini-permanent terms. Examples of housing projects that are reflective of our mission are the renovation of foreclosed blighted 1-4 family properties for rental or sale to the acquisition of larger multifamily projects for use as rental or supportive housing for people with special needs.
For the Community
More units of affordable housing will be available throughout the New Haven region for both owners and renters in a variety of housing types. This will include the renovation of blighted properties in target neighborhoods which will help stabilize those neighborhoods. Access to affordable housing units will contribute to a higher quality of life for the residents and increased stability in their lives.
GNHCLF makes loans to non-profit organizations for cash flow and small scale capital purchases. Our current loan portfolio contains six non-profit cash flow loans in the amount of $139,000 and one facilities loan in the amount of $350,000. Non-profit lending reflects approximately 6% of the loan portfolio. The stability of nonprofit sector is an important factor in maintaining a vibrant community and in serving the community development needs of the region. Cash flow loans are secured by assignments of grant dollars or demonstration of earned third party payments, grants or contracts. Often these cash flow loans prevent service interruptions in programs provided by these non-profits. In addition to making loans, Loan Fund staff work with the non-profit leaders to analyze cash flow, review budgeting and explore new ways if possible to stabilize future cash flow. Capital loans are made for small scale repairs or equipment purchase and are repaid over 3 to 5 years. Staff also assist borrowers where possible in planning for future capital needs.
GNHCLF Success: Measures of lending activity will reflect the success for the GNHCLF. Success (for cash flow and capital lending) will be reflected in the number and dollar volume of loans originated, the repayment rate of the loans and the number of new nonprofits assisted.
Borrower Success: Success for the borrower is reflected in the programs and services they are able to provide as a result of the loan. For cash flow loans this may be measured by the number of staff who are able to receive scheduled pay and continue working - avoiding any service interruptions which would have occurred without the ability to pay expenses. For capital purchase it may be measured in additional services that can be provided (e.g. a new van purchase allows more clients to be transported), or the ability to maintain necessary services (e.g. boiler or roof repair in a facility.)
GNHCLF Success: Internal success is measured by tracking lending and payment activity. Loan performance is tracked regularly at internal staff portfolio reviews as well as by the Board and Loan Committee on a regular basis. Poor performance (late payment, loan defaults) in the portfolio can indicate issues with the borrower's environment but may also reflect the need to change GNHCLF underwriting or loan structuring.
Borrower Success: Success for the borrower is monitored by their ability to repay the loan as well as by how often they need to apply for additional loans and how well they have planned for their cash flow and capital needs.
Program success may also be measured by surveys of regular borrower surveys.
"GNHCLF's lending has assisted us in fulfilling our mission by allowing us to refinance our building several years ago to re-organize debt and keep our doors open. Most recently, we have been able to take short-term cas flow loans through GNHCLF to assist us in meeting payroll obligations during periods when payment on grants was slowed or delayed."
Christopher A. Cole, Executive Director, AIDS Project New Haven
The GNHCLF has two HUD Certified counselors who provide foreclosure mitigation counseling to homeowners in or at risk of going into foreclosure. Clients are referred to the Loan Fund through partner agencies, the HUD website, local outreach activities or referrals from others who have benefited from our services.
Counselors work with homeowners to develop a clear understanding of their financial circumstances and the terms of the existing mortgage and then develop a viable strategy to pursue. This could be a loan modification request from the bank servicer, access to applicable government programs, or even short sales. Staff make sure that the clients are prepared to take full advantage of the Connecticut foreclosure mediation program. In 2014,79 households received free foreclosure counseling services and more than 70% of clients experienced a positive outcome.
Counseling will also prevent homeowners from falling prey to the many "housing assistance" scams where they risk losing more money and gaining no assistance.
With the assistance of GNHCLF counselors, families in, or at risk of foreclosure are able to utilize available programmatic, legal and financial resources to arrive at the most advantageous resolution of their housing issue. In most cases a successful resolution will mean that the family is able to get a permanent mortgage modification that allows the family to stay in their home with a mortgage payment that is affordable and sustainable. In some circumstances, the family may need to leave the home but if that is the case it is done in a time frame and a manner that does the least damage to the homeowner's long term credit and provides them a stable transition to another living situation.Counseling will also prevent homeowners from falling prey to the many "housing assistance" scams where they risk losing more money and gaining no assistance.
Client cases are tracked through the HCO (Housing Counselor Online) system which is used to report to HUD and our funders. The system tracks client progress and outcomes through the counseling process. Financial, demographic and other client data are also captured by the system.
Counselors participate in monthly knowledge sharing with other counselors in the State and in other additional training seminars to continue to learn best practices in the field.
Two counseling examples:
NC – GNHCLF staff met with this single mother of two in September. She had applied for a modification due to reduced income and loss of overtime income. She completed the trial payments and was then told that she was ineligible for a modification. The trial payments, less than her regular payment now made her loan delinquent and in foreclosure. We contacted the servicer in October and were told that she may be eligible for a new program. NC completed the necessary documents. In November her mortgage was modified.
C C – Single parent of an adult child still living at home, CC had a reduction in income due to furlough days, taking in her elderly mother, and loss of income from her significant other who moved out of her home. In July GNHCLF presented documents to her servicer. In August she received trial payments for the months of September, October and November. In January of the following year she received permanent modification documents.
GNHCLF extends an investment opportunity to individual, institutional and corporate investors interested in making a socially responsible investment with local impact. There is currently $6.5M in our community loan pool and our desire is to increase that amount in 2015 with $1M in additional investment. With a minimum of $1,000 investors can make loans to us for terms between 1 and 10 years at rates beginning at 0 to 3 percent.
Individuals or organizations may loan money to GNHCLF which will be put to use in Greater New Haven through its Community Loan Pool. Investments start at $1,000 for a minimum term of one year. Interest is paid quarterly or annually according to investor preference. Contact Darcy Arcand, Development Officer for more details.
In the next year the Fund intends to raise an additional $750,000 in loan capital to assist more borrowers through its lending.
Investment outreach to new individuals and institutions interested in socially responsible investment will gain a deeper understanding of the work that the Loan Fund does and the community needs it supports.
No investors will lose any of their capital.
GNHCLF Success: The Fund hopes to grow the size of its available capital from individuals, religious institutions and corporations by $750,000 during this fiscal year, to provide a more substantial impact in terms of affordable housing development and nonprofit organization support through its lending. The Fund hopes to accomplish this by adding new investors and increasing the amounts pledged by our 46 current investors.
The Fund continually tracks the balance of its investments as part of its overall financial tracking. Success is tracked by the increase in the availability of investments available for lending, by the percentage of investors who roll their investments over for an additional term once they mature, and by the Fund's ability to repay investors when investments mature. The Fund has never lost any investor capital in its 26-year history. This record is a reflection of both the Fund's management of its lending risk through careful underwriting, good borrower relations, and prudent development of loss reserves and other net assets.
One measure of investor program success is to renew at least 85% of loans at term maturity.
"Calvert Foundation invests in GHNCLF to help create healthy homes and communities while empowering more individuals and families to overcome poverty and homelessness." Andrew W. Shlack APA, Assoc. AIA-Senior Investment Officer, US Investments, Calvert Foundation
"In keeping with the Adrian Dominican Sisters' criteria for community investing, GNHCLF invests in affordable housing development which ultimately assists low to moderate income individuals and their families. We recognize and applaud not only affordable housing development, but the promotion of the environmentally-friendly construction ("green construction") loan program. Thank you for all you do to improve lives and communities in the Greater New Haven region!"
Lura Mack, Director of the Portfolio Advisory Board, Adrian Dominican Sister
"We seek to allow our everyday investors to support the work GNHCLf does building commnities and development affordable housing in Connecticut"
Julie Sandler, Officer, Risk Management, Calvert Foundation
The Fund routinely makes loans in conjunction with other Connecticut based CDFIs and began a intensive exploration of formal collaborative opportunities with two other Connecticut based CDFIs with an anticipated January 1, 2016 formal merger date.
GNHCLF has a unique committee structure specific to its primary role as a lender. The Community Loan Committee makes lending decisions on behalf of the organization. The committee is made up of both board members and non-board members whose areas of knowledge and expertise are important to the lending process.
Indirect Public Support HelpIndirect public support represents revenue received through solicitation campaigns. This includes funding United Way and other federated fundraising organizations, but does not include donor designated contributions.
Earned Revenue HelpEarned revenue represents income generated in direct exchange for a product or service.Earned income includes income from government contracts.
This profile, including the financial summaries prepared and submitted by the organization based on its own independent and/or internal audit processes and regulatory submissions, has been read by the Foundation. Financial information is inputted by Foundation staff directly from the organization’s IRS Form 990, audited financial statements or other financial documents approved by the nonprofit’s board. The Foundation has not audited the organization’s financial statements or tax filings, and makes no representations or warranties thereon. The Community Foundation is continuing to receive information submitted by the organization and may periodically update the organization’s profile to reflect the most current financial and other information available. The organization has completed the fields required by The Community Foundation and updated their profile in the last year. To see if the organization has received a competitive grant from The Community Foundation in the last five years, please go to the General Information Tab of the profile.
A strong community not only meets its members’ basic needs but also works to create long-term solutions to their problems. Provide people with affordable housing, enough to eat and access to affordable health care and you enable them to envision a better future for themselves.
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