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FEDERAL HOME LOAN BANK GRANTS
Overview
The Federal Home Loan Bank of Des Moines (FHLB-DM) offers an “Affordable Housing Program” designed to assist in the development of affordable housing for low and moderate income households.
HFH-MN applies for this funding and administers this
program on behalf of all affiliates in
the state: training affiliates in program
requirements, creating standardized documents,
reviewing / submitting affiliates’ applications
for funding, and providing quarterly
reporting. Habitat for Humanity of Minnesota
has applied for and received 12 grants
since 1998 totaling $5,054,920.
Federal Home Loan Bank of Des Moines
Affordable Housing Program
Grant
Number |
Grant
Amount
per Home |
Homes
Funded |
Total
Funded |
| 98B01 |
$6,250
|
100
|
$625,000
|
| 99B21 |
5,500
|
86
|
473,000
|
| 01A05 |
6,000
|
83
|
498,000
|
| 02B05 |
6,000
|
83
|
498,000
|
| 03B17 |
6,000
|
30
|
180,000
|
| 04B13 |
6,000
|
62
|
372,000
|
| 04B22 |
6,000
|
30
|
180,000
|
| 06A09 |
6,960
|
71
|
494,160
|
| 06A21 |
7,980
|
62
|
494,760
|
| 08B03 |
25,000
|
10
|
250,000
|
| 09A09 |
9,000
|
55
|
495,000
|
| 10A08 |
9,000
|
55
|
495,000
|
| Total |
|
727
|
$5,054,920
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The affiliates pay an application fee of 7.5% of the
grant amount. Affiliates must document
the successful completion of homeowner
training for
homeowners benefiting from this program.
Affiliates must also be very detailed
in how they quantify the cost of the
home, verify
family income, and how they handle their
closing process / documentation. HFH-MN
will again provide training in how to
utilize this program
in 2011 at various locations around the
state.
 
Application Materials
– 09A09 Application Materials – New Construction in Greater Minnesota:
MRB Income Guidelines – Rural and Urban
Obtain the MRB Income Limits table for Minnesota.
Background
This Habitat for Humanity of Minnesota
(HFH-MN) program has been the most widely
used by affiliates— 28 of 33 affiliates
have participated since inception in
1998. HFH-MN has been sponsored by Bremer
Bank of Willmar to receive 12 Affordable
Housing Program grants from the Federal
Home Loan Bank of Des Moines (FHLB-DM)
totaling more than $5.0 million since
1998. These funds are helping to construct
or rehabilitate well over 727 homes;
over half are located in rural areas.
Funding has been secured through fall
2012 to provide the Minnesota Habitat
affiliates with assistance totaling $9,000
per new home in Greater Minnesota. The
grants are “earned out” by the homeowner
over a five-year period and are secured
by a deed restriction.
Vision
Our first grant from FHLB-DM was strictly for down payment assistance. The affiliate had to demonstrate that the first mortgage amount had been reduced by the amount of the grant. During our administration of this first grant, we discovered that Habitat affiliates rarely include anything other than hard costs in their calculation of the first mortgage amount. The full market value of donated land, labor or materials was rarely used in the calculation of the total cost of the home. In addition, Habitat affiliates were not covering any other out of pocket costs associated with the creation of the home— salaries, office expenses, etc.
As a result of the FHLB-DM’s review of our first grant, a revised structure for the program was derived. This revised structure allows for funding of Habitat homes that establish “need”, and allows the Habitat affiliates to deduct the grant amount from the second mortgage amount (or to even add the grant amount to the total amount of debt). This structure allows Habitat affiliates to continue to keep the costs of homeownership "affordable" while allowing the affiliates some resources to keep their organizations thriving.
Federal Home Loan Bank Award of Excellence
In May 2003, HFH-MN and Bremer Bank were awarded the FHLB Award of Excellence. The award honors leaders who provided a vision and overcame obstacles and challenges to create more affordable housing for an under served population in their community. HFH-MN was honored for its contribution to local Habitat affiliates and for the creation of more affordable housing in Minnesota.
The Future
HFH-MN plans to submit grant requests to
continue this program beyond 2012. Our
affiliates' continued demonstration of
excellence in affordable housing and
dedication to strengthening individuals,
families and communities throughout Minnesota
will help ensure that this program will
continue.
Habitat for Humanity of Minnesota
Office: 2401 Lowry Ave NE #210
Minneapolis, MN 55418
Phone: 612.331.4439
Fax: 612.789.0846
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