New Mexico Preservation Loan Fund

Purpose

MFA’s New Mexico Preservation Loan Fund (NMPLF), created in 2023, is a flexible funding source for multifamily properties at-risk of exiting the affordable housing stock, providing opportunities for the preservation of affordable housing in the state of New Mexico. The NM Preservation Loan Fund is available to owners, developers, and other partners seeking funding for a wide array of preservation-oriented needs. This includes rehabilitation funding for owners struggling with physical upkeep as their multifamily property ages, acquisition financing for prospective owners seeking to acquire multifamily affordable projects and maintain their affordability over time, and predevelopment funding for existing LIHTC properties pursuing resyndication. The Fund will strive to provide interest rates and loan terms more flexible than may be provided by traditional financial institutions.

Eligible Borrowers

Eligible applicants include non-profit organizations, for-profit organizations, governmental housing agencies, regional housing authorities, governmental entities, governmental instrumentalities, tribal governments, tribal housing agencies, builders, corporations, limited liability companies, partnerships, joint ventures, syndicates, associations, or other entities that can assume contractual liability and legal responsibility by executing one or more written agreements with MFA.

Eligible Projects and Programs

The NM Preservation Loan Fund Program provides assistance to all types of multifamily affordable housing located in the state of New Mexico and deemed “at risk,” regardless of location, construction style, or occupancy. “At risk” properties are defined as those properties in danger of exiting the affordable housing stock due to conversion to market rents, physical dilapidation, or any other causes. NMPLF is not restricted for use toward the preservation of properties previously funded by MFA.

The NM Preservation Loan Fund Program assists only existing multifamily affordable properties in order to preserve existing multifamily affordable housing stock.

The NM Preservation Loan fund program accepts applications for projects throughout the state and will endeavor to provide program assistance with a fair statewide geographic distribution. However, NMPLF funding will strive to target projects that may have more difficulty securing funding from other sources.

NMPLF is currently in its pilot phase and will only be awarding limited funding under its Rehabilitation Initiative, providing long-term, low interest loans to finance the rehabilitation of low-income multifamily housing. MFA will roll out other NMPLF Initiatives (including an Acquisition, a Housing Authority, and a Bridge Initiative) in subsequent phases at dates to be determined by MFA.

Other Requirements

Projects will be subject to beneficiary income limits and other requirements. As a general practice, NMPLF requires that the project maintain existing restrictions on the property in effect at the time of funding application, including income and rent limits instituted by MFA or another entity. MFA will require commitment to an affordability period depending on Initiative type and amount of funding awarded, as outlined in the NMPLF Policy. See the NMPLF Policy for other requirements.

Application Process

Applicants should provide all items listed on the appropriate application checklist. If all items cannot be provided at the time of application, applicants must indicate why and state when the requested information will be available.

MFA reserves the right to accept or deny any application at its own discretion. MFA will deny any application which staff believes does not align with the intent and spirit of the program.

Loan Terms

Loans for projects awarded through the Rehabilitation, Acquisition and Housing Authority Initiatives are structured as long-term, low interest loans to finance the acquisition or rehabilitation of low-income multifamily housing. Loan terms are flexible, but have a base rate of 1% and base term in alignment with the project’s NMPLF affordability period (see NMPLF Policy). Loan payments will typically be interest-only payments monthly, with all unpaid interest, unpaid fees, and outstanding principal balance considered for forgiveness at the loan’s maturity. Other reasonable payment terms may be considered. Bridge Initiative projects approved for award will all receive a one-time grant at an amount set by MFA to assist LIHTC properties at or near the end of their 15-year compliance period, toward the resyndication of their eligible LIHTC property.

How To Apply

Application forms can be obtained from MFA and submitted at any time. However, 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. 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.