CommunityPartnership InitiativesFinancingforAffordable Rental HousingLendingCriteria Guide

BCHousingprovidesinterimand/orarrangeslong-termfinancingfornon-profit societiesto

createself-sustaining,affordablehousingdevelopments.BCHousing’scapacitytoprovidefinancingwith favourabletermsisthecornerstoneoftheCommunityPartnership Initiativesprogram.

GeneralGuidelinesforBorrowerEligibility*

•Theborrowermustbearegisterednon-profit society.

•Thesociety’sconstitution andbylawsmustmeetBCHousingrequirements.

•Theborrowershouldhaveappropriatemanagementexperience inoperatingahousingprojectofsimilartype andsize.

•Theborrower isrequiredtoenterinto anoperatingagreement withBCHousing.

Advantages

Flexibility–Non-profit societies can obtaininterimandlong-termfinancingupto100percentofthetotalcostofaffordable rentalhousing projects.There isnofeepayable attheoutsetandanyborrowingcosts canbe includedintheloanamount.

Low InterestRates–BCHousingfinancingprovidesaccesstocompetitiveinterestrates.

CMHCLoanInsurance–Alllong-termfinancingwillhaveCMHCloaninsurance.

Availability–Financing is availablefrom BC Housingfor arangeofaffordable rental housinginitiatives,includingnewconstruction aswell aspurchasesandconversions.

*BCHousingmayrequireadditional guaranteesorsecurityincertaincasesasitdeemsappropriate.Formoreinformationonourfinancingrequirements,pleaserequestameetingwiththeDirector,RegionalDevelopmentthatisresponsibleforyourcommunity.

Common TermsandConditions

LoanPurpose / Toprovideinterimand/orarrangelong-termfinancingforthecreationofaffordablerentalhousingunitsforeligiblelow-andmoderate-incomehouseholdsinBritishColumbia.
Forresidentialunitswithlessthantwo (2)bedrooms, a grosshouseholdincomethatdoesnotexceedthemedianincomeforfamilieswithoutchildren,asdeterminedbyBCHousingfrom timeto timebasedondataprovided byStatisticsCanada.
Forresidentialunitswithtwo(2)ormorebedrooms,a grosshouseholdincomethatdoesnotexceedthemedianincomeforfamilieswithchildren,asdeterminedbyBC Housingfromtimeto timebasedondataprovidedbyStatisticsCanada.
Moreinformation:
MaximumLoan / Aloanforthedevelopmentofanaffordablerental housingprojectmaybeupto100percentofthetotalcosttocomplete constructionasdeterminedbyBCHousing.
LoanAmortization / Thetypical amortizationperiod is35 years.
MinimumDebtCoverageRatio(DCR) / Theminimumdebt coverageratio(DCR)is1.2based on marketrentsor1.1based onbelowmarket rents.
SourceofEquity / Equitycanbeinthe formofcash, grants,municipalcontributions,subordinateddebt,orlandat adiscountedcost.
MortgageLoanAdvances / Allmortgage loanadvancesmustbesupportedbysubstantiatedconstructionprogressclaims(uptothe approvedmaximum loanamount).
BorrowingCosts / Include:
  • Onepercentofmaximum loan
  • $75perunituptoa maximum of$5,000per loan
  • Legal andothercostsincurredby BC Housing.

LoanRepayment / Duringconstruction,theinterim loan isfullyrepayable ondemand.Atprojectcompletion,BCHousingwillmakearrangementstotake-outtheinterimloan.
Take-OutLender / Uponproject completion,BCHousingwillfacilitateatake-outmortgagewitha third partylender(theTake-OutLender)toobtainthebestinterestratethroughacompetitivebiddingand selectionprocess.
ProjectMonitor / BCHousingmayengageaquantitysurveyorto retainan independentcost estimateatsome,orallofthefollowingproject design stages:schematicdesign,designdevelopment,50percentworkingdrawings,and100percentpre-tenderworkingdrawings.The quantitysurveyormayalso berequestedtoprovideloan monitoringservicestoconfirmthecontractor’sprogressclaimsduringconstructionandprovidea value analysis, ifrequired.
ConstructionContract / BCHousingwillconsiderconstructionmethodsthat arethemostsuitablefortheproposedprojectculminatingwith a guaranteedfixedprice contract (basedonCanadianConstructionDocumentsCommitteestandards)with BCHousingsupplementarygeneralconditions.
BondingRequirements / Fiftyper centonlabourandmaterialsand50percentonperformanceofallmajorcontracts(suchasstructural,mechanical,electrical,formsandconcrete)isrequired.

FormoreinformationabouttheCommunityPartnershipInitiativesprogramvisit: