Oct. 5 was supposed to be an ordinary day at the office for Carla Weil, the executive director of the Greater New Haven Community Loan Fund Inc.
Instead, that’s when Weil found out the fund would have access to millions more dollars with which to support affordable housing developments in New Haven — all thanks to a $910,000 Federal Recovery and Reinvestment Act-funded grant.
Weil explained that the fund intends to spend the entirety of the grant this fiscal year and that the money will fund the rehabilitation of foreclosed homes, which will then be sold to private homeowners or low-income housing developers. Already, the fund has properties it is supporting in three New Haven neighborhoods: Newhallville, the Hill and Fair Haven.
In order to increase the grant’s impact on the community, Weil said, the loan fund will use the money as collateral to take out more loans. The fund will then loan out the money to more affordable housing developers than it previously would have been able to support.
In addition to providing flexible loans, the loan fund also advises people who are struggling to purchase homes or to make down payments; fund employees often assist them with the paperwork required to acquire funding.
Jackie Downing, the loan fund’s director of development and administration, said that in 2008 the organization helped first-time homeowners file for 41 loans and helped commercial and non-profit organizations to file for 16 loans. Throughout its 21 years of operation, the loan fund has helped to create more than 2,150 units of housing and lent more than $47 million to local developers, Weil said, emphasizing that it lost less than 0.5 percent of its investments because of loan defaults.
“Because we’re not a regulated entity, we’re able to provide [our borrowers with] the necessary flexibility to make sure projects come to fruition regardless of financial difficulties that come up midstream,” Downing said. (The loan fund is not subject to the same financial regulations facing commercial banks because it is a non-profit entity that is an extension of the New Haven city government.)
Many of the organizations that borrow from the fund are charitable or social-services groups, said Downing, whose first priority is to ensure that their developments are completed and, as a result, that they tend not to walk away from a project and default on their loans. She added that the fund takes great care to make sure its private investors are repaid.
“I don’t know who we would go to without the [community loan] fund,” said Patricia McCaan, director of the not-for-profit low-income housing development organization Casa Otonal. McCaan said her organization has borrowed approximately $350,000 from the loan fund over several years, which has allowed the organization to generate the funds that supported the development of 137 units of affordable housing in New Haven’s third ward, which covers New Haven’s medical district by the West River.