Section 108 Loan Guarantee Program
The City of Philadelphia invested $7.5 million in Section 108 funds in the Piazza at Schmidt’s Commons, the redevelopment of an 8.2 acre vacant parcel in the City’s Northern Liberties neighborhood into a commercial and residential destination. This development had a dramatic effect, leading to a $1 billion increase in the aggregate market value of real estate in the neighborhood, stimulating the citywide economy, and creating jobs.
The Section 108 Loan Guarantee Program (Section 108) provides communities with a source of financing for economic development, housing rehabilitation, public facilities, and other physical development projects, including improvements to increase their resilience against natural disasters. This flexibility makes it one of the most potent and important public investment tools that HUD offers to state and local governments.
Section 108 offers state and local governments the ability to transform a small portion of their Community Development Block Grant (CDBG) funds into federally guaranteed loans large enough to pursue physical and economic revitalization projects capable of revitalizing entire neighborhoods. Such public investment is often needed to inspire private economic activity, providing the initial resources or simply the confidence that private firms and individuals may need to invest in distressed areas.
Loans typically range from $500,000 to $140 million, depending on the scale of the project or program. Under Section 108, project costs can be spread over time with flexible repayment terms, and borrowers can take advantage of lower interest rates than could be obtained from private financing sources.
View the Current Availability of Section 108 Financing to see how much borrowing capacity your State or community has under the program
The Section 108 Underwriting Guidelines for Income-Producing Projects assists Section 108 recipients in underwriting third party loans that finance the development of income producing properties.
Section 108 Guides, Tools, and Webinars
Guides, tools, webinars, and other resources are provided to assist grantees and program partners in designing and implementing projects and programs.
This collection of online technical assistance products will help grantees: create transformative impact in your community, improve the lives of all residents, and especially those with low and moderate income levels; develop strategies that bring partners and resources together, leveraging and building community assets; and implement your program effectively, increasing the likelihood of successful projects.
Section 108 News & Announcements
Corrected CPD Funding Matrix Reports Posted
Date Posted: July 19, 2018
CPD Funding Matrix and Dashboard Reports Posted
Date Posted: July 03, 2018
Solicitation for Section 108 Underwriting Team
Date Posted: June 29, 2018
CPD Income Eligibility Calculator Updated with FY 2018 Income Limits
Date Posted: June 01, 2018
Current Availability of Section 108 Financing - CDBG Entitlement and State Grantees
Date Posted: January 10, 2018
HUD Publishes Federal Register for Section 108 Loan Guarantee Program: Announcement of Fee to Cover Credit Subsidy Costs - FY 2018
Date Posted: October 13, 2017