In an effort to address the shortage of workforce housing in Central Oregon, Mid Oregon Credit Union has introduced a new loan program to encourage the development of new affordable rental housing.
Mid Oregon’s Workforce Housing Loan Program offers interest rate subsidies of up to 2.5 percent for rental properties that maintain affordable rental rates for five years after loan funding. To qualify, rental rates could not exceed 30 percent of gross income for tenants earning between 60 percent to 140 percent of Area Median Income (AMI). Current AMI in Deschutes County stands at $55,700 for a family of four. The program also offers a fixed interest rate for five years.
“We know that to have a thriving local economy over the long term, working families need access to stable and affordable housing,” says Kevin Cole, executive VP of Mid Oregon Credit Union. “By helping property owners obtain the financing they need to develop and increase rental properties, we can make a significant contribution toward increasing the supply of local affordable housing.”
Funding for the interest rate subsidy for this loan program will come initially from a $100,000 grant Mid Oregon received from the Northwest Community Foundation (NWCUF) in spring 2019. This funding will allow Mid Oregon to provide approximately $1 million in financing under the program. The credit union will continue seeking additional nonprofit and government partners to fund the program’s growth and expansion.
In addition to receiving below-market interest rates, property owners will benefit by having a more stable tenant pool and flexible underwriting standards that account for rent limits. Tenants should benefit through more stability in local rental rates, as well as a greater supply of available housing.
Interested borrowers seeking more details on lending guidelines and qualifications for the Workforce Housing Loan Program can contact Mortgage Manager Matt Mitchell at mmitchell@midoregon.com, or Director of Commercial Markets Steve Ferber at sferber@midoregon.com.
