General Obligation (GO)
Multifamily Rental - Permanent Loan Program
The General Obligation (G.O.) Program is a source of permanent mortgage financing for affordable rental housing which meets certain low income occupancy and rent limitation requirements. The Board provides mortgage underwriting and loan management as well as financing.
The Montana Board of Housing (MBOH) obtained a General Obligation (G.O.) rating of A2 from Moodys Investors Service in April, 1997. With this rating, the Board is able to issue tax exempt bonds to finance projects that do not have mortgage insurance. These projects will typically have multiple sources of funding which have very little risk of loss in the event of loan default.
The Board will provide fixed rate mortgages for low income rental housing which meet underwriting eligibility established by the Board.
NOTE: The Risk Sharing Program guidelines will be used for underwriting projects.
Eligible Applicants: For-profit, non-profit, and governmental entities.
Type of Program: Permanent financing for multifamily rental property. The Board obtained a General Obligation (G.O.) rating of A2 from Moody's Investors Service April, 1997. With this rating, the Board is able to issue tax exempt bonds to finance projects that do not have mortgage insurance.
Types of Projects: Residential rental units meeting affordability guidelines and available to the general public. New construction and acquisition with substantial rehabilitation. Must be complete living units.
| Security: | First Mortgage |
| Loan-to-Value: | These projects will typically have multiple sources of funding which have very low loan to value ratios and little risk of loss in the event of loan default |
| Loan Amounts: | Maximum loan based on per unit maximums and loan-to-value as noted above |
| Debt Service Coverage: | Minimum of 1.15 to 1 |
| Loan Term: | 30 year fixed rate |
| Reserve Requirements: | Escrows for property taxes and hazard insurance, reserve for replacement |
| Loan Rate: | Determined by market at the time of bond sale |
| Fee Limitations: | Management, builder and developer fees are limited |
| MBOH Fees: | Total of 1% of mortgage loan amount, including origination fees |
| Mortgage Insurance Premium: | No Insurance |
