Loans
PROJECT FINANCING LOANS
- ACQUISITION AND PREDEVELOPMENT LOANS - are used for projects that are likely to proceed to construction. Commitment for permanent financing has usually been obtained by the organization from one or more sources. All LISC loans must be secured with either real estate or other assets from the borrower.
- CONSTRUCTION FINANCING - is provided by LISC usually in tandem with a lead construction lender, such as local bank. LISC is willing to take a subordinate position on its collateral to conventional lender.
- MINI-PERM LOANS - are used generally for commercial or industrial developments, charter schools or other community facilities such as health care and child care facilities. These loans can have a maturity of up to 7 years depending on the nature of the project and may be either fully-amortizing or have a longer amortization term with a balloon payment at the end.
- EQUITY LISC - also provides equity for affordable "Low-Income Housing Tax Credit" financed rental housing through its affiliate, the National Equity Fund (NEF).
Terms & Conditions
Terms and conditions of any specific funding are set to meet the needs of the community, the project itself and the project sponsor. LISC will negotiate loan terms, disbursement and repayment conditions and schedules as well as any special conditions. Terms reflect the risks associated with a particular project, the developer's overall track record and LISC's experience with the project sponsor.
Interest Rates
LISC interest rates vary according to the term and type of the loan. Loans can be used for residential, commercial or industrial real estate and for community facilities.
Amount
Most loans range between $40,000 and $500,000, though LISC does provide up to $1million in lines of credit for organizations with strong track records and active development programs.
Terms
Terms vary depending on what a project needs and the type of loan. Maturities vary, though loans are generally in the two to seven year range. Standard terms are as follow:
- Acquisition and Predevelopment Loans: Interest due quarterly with principal due at construction closing.
- Construction loans: Interest due quarterly with principal due at construction completion, upon sale of the property, or the securing of permanent financing.
- Mini-perm loans: principal and interest due monthly. Amortization schedules are negotiable.
Cost
An application fee of 150 basis point is charged. When the loan closes, LISC will apply this fee to pay for the closing fee of 100 basis points. Legal fees in the amount of $3000 - $5000, depending on the size and purpose of the loan are also charged.
HOW DO I APPLY?
Eligibility
Organization must be in good standing with the State of Arizona and the project must be in the Phoenix metropolitian area.
Organization is also required to submit current financial reports, prepared by independent auditors, showing that the applicant’s fiscal condition is sound.
Application Process
You may want to discuss your request with a LISC Phoenix Staff person first, please feel free to contact Ruth Osuna, Program Director at (602) 417-1404. Please fill out the appropriate type of funding LISC Loans Application below.
Click here for Loan [MS Word Document]
Click here for Acquisition & Predevelopment Loan [MS Word Document]
When you have completed the application please mail to:
Attn: Ruth Osuna
LISC Phoenix
111 W. Monroe, Suite 1610
Phoenix, AZ 85003