Construction Accounting Article -
If You Build It, Will they Come?
Target Audience: Construction Industry Professionals, Afforable Housing Industry, Community Developers, Construction Accounting Interest
Over the past 40 years, Americans have witnessed the evolution of our country’s landscape. Tax abatements, low-interest financing and grants have been some of the incentives to encourage development in otherwise “overlooked” areas. Anyone willing to turn vacant lots and abandoned buildings into new businesses or affordable housing could enjoy years of benefits.
Yet, while incentives are great, these projects will never get off the ground unless there are people able to buy the homes or offices to be built. If you’ve considered trying your hand at developing a vacant property in a disadvantaged area, or working with a developer to do so, you should know that there are a variety of financing options available for would-be buyers.
Organizations Provide Help
Many organizations provide underserved communities access to affordable financing. Some examples include:
The Community Development Financial Institutions Fund. A bipartisan initiative established by the Riegle Community Development and Regulatory Improvement Act of 1994, the Fund has awarded $771 million to organizations and financial institutions that provide assistance to underserved populations. Its purpose is also to promote economic revitalization and development in distressed areas across the United States.
The Center for Responsible Lending (CRL). Based in Durham, N.C., this group has given $3.5 billion in financing to help more than 40,000 families own homes or small businesses. The CRL also partners with other organizations to encourage antipredatory lending laws.
Opportunity Finance Network. The successor to the National Community Capital Association, this newly formed group recently announced plans to use $1 billion a year to fight predatory lenders. Over the decades, its network of 167 community development institutions has provided nearly $10 billion, resulting in 317,000 homes and helping buyers in every state. By partnering with a national mortgage banking entity, this organization’s “Fair Mortgage™” program offers alternative residential mortgage products to people with blemished credit records.
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