New Mexico Housing Trust Fund

Purpose

Provide flexible funding for housing initiatives that will provide affordable housing primarily for persons or households of low or moderate income.

Eligible Borrowers

Nonprofit organizations, for-profit organizations, governmental housing agencies, regional housing authorities, governmental entities, governmental instrumentalities, tribal governments, tribal housing agencies and other entities as outlined in the Notice of Funding Availability (NOFA).

Eligible Projects

Costs of infrastructure, construction, acquisition and rehabilitation necessary to support affordable single family or rental housing as outlined in the NOFA.

Secondary Financing

MFA mortgage may be in first or junior lien position on the property.

Interest Rates

9% Low Income Housing Tax Credit (LIHTC) Projects:

• Base interest rate of 3%. May allow for a 1% discount for rural, senior, tribal, and permanent supportive projects. Generally, the interest rate for 9% LIHTC projects will be no less than 2%.*

4% LIHTC Projects:

• Base interest rate of 2%. May allow for a 1% discount for rural, senior, tribal, and permanent supportive projects. Generally, the interest rate for 4% LIHTC projects will be no less than 1%.*

Non-LIHTC Projects:

• Base interest rate of 1%. Generally, the interest rate for non-LIHTC projects will be no less than 1%.*

* Projects located in an Underserved Area (areas that have not received MFA funding in the last five years) may receive an additional discount of 1%. If loan request exceeds construction and/or permanent funding limits, MFA will increase base interest rate by 1%.

Loan Term & Amount

Construction loans: up to two years (current maximum $3,000,000)
Permanent long-term amortizing loans: up to 40 years (current maximum: $2,000,000)

Affordability Requirements

Rental: Households earning 60 percent or less of area median income (AMI.)

Single family residences: Households earning 150 percent or less of AMI.

Guaranties

A guaranty will be required from a financially responsible entity acceptable to MFA if funds are to be used during construction. If the proposed borrower has sufficient financial depth, a guaranty may not be required. See checklist for required information.

Subordinations

New Mexico Housing Trust Fund (NMHTF) loans may be subordinated to first lien position loans but are still considered "hard debt" and not subject to available cash flow for repayment. For certain HUD guaranteed loans such as 221(d)4, HUD requires that subordinate lenders sign its cash flow-only subordination agreement (form HUD-92420M). MFA will consider signing on a case-by-case basis at its sole discretion. For such projects, funding limits and terms may not reflect those currently posted on the program webpage that are intended to represent fully amortizing loans. Contact the NMHTF Program Manager (see tab at bottom of page) to discuss.

Application Due Dates

Complete applications must be received no later than 60 days prior to a regularly scheduled meeting of the MFA Board of Directors in order to be considered at that meeting. Meetings of the MFA Board of Directors are generally held every third Wednesday of the month. With the exception of applications submitted for consideration with applications for 9% Low Income Housing Tax Credits (LIHTC), all applications submitted by the deadline for a particular meeting of the MFA Board of Directors will be treated as one funding round and evaluated concurrently. 

New Mexico Housing Trust Fund and 9 Percent LIHTC

If applicants plan to request NMHTF funds when applying for Low Income Housing Tax Credits (LIHTC) in the 9 percent annual competitive round, they must do so as part of their LIHTC application (see LIHTC application package for details). If a project receives a preliminary LIHTC award notification, the applicant must submit the required fee(s) within five business days of receipt of said notification.

NMHTF applications submitted with LIHTC applications will follow the approval process found in the then-current State of New Mexico Housing Tax Credit Qualified Allocation Plan (QAP) and will generally be heard at the MFA Board of Directors meeting with the accompanying 9% LIHTC application.

New Mexico Housing Trust Fund and 4 Percent LIHTC

When applying for New Mexico Housing Trust Fund and 4 percent tax credits, applicants must apply simultaneously using the same application, schedules, etc. Because such projects are not financially feasible without tax credits, MFA will not review a Housing Trust Fund application without the 4 percent LIHTC application.