Frequently Asked Questions
Who is Funding Partners?
Incorporated in 1996 as a 501c3 non-profit and subsequently certified as a Community Development Financial Institution (CDFI) in 1999 by the Department of the Treasury, Funding Partners (FP) is governed by a volunteer Board of Trustees representing human service providers, housing agencies, public officials private enterprise and financial institutions.
What is the Definition of 'Affordable'?
FP recognizes that the term "affordable" can be defined very differently, based upon the geographic market and socio-economic population represented. Generally, housing is considered affordable when no more than 30% of gross monthly income is expended to rent a unit, or 38% of income to own a unit (PITI). Utilities, maintenance and other consumer obligations are not considered.

FP intends to serve households at, or below, 80% of Area Median Income (AMI), which is published annually by HUD for each county in the country. The raw number is factored to determine the median based upon to the number of occupants the unit is designed to accommodate. For that purpose, each legal bedroom represents 1.5 occupants, rounded up. Studio apartments are considered single-occupancy.

Proposed rent for each unit configuration is compared to the median income, adjusted for the corresponding household size, to determine the income level served by the project and number of units at each level. Rents priced above 60% of AMI are considered "market rate" in most geographic markets and may not be considered "affordable" under program guidelines.

For sale housing is considered "affordable" where the debt service - using a 30-year amortization schedule and projected interest rate, plus taxes, insurances, and HOA fees - results in a housing payment that falls at or below 38% of monthly income for the number of unit occupants. The projected debt service may be reduced to the point of affordability using subordinate financing or other methods of deferring or mitigating expense to the potential home buyer. The FP H2O product is one option.
What Qualifies as an Affordable Project?
Any entity that proposes to develop, rehabilitate, acquire or otherwise preserve housing units that fall within the definition described previously is eligible to apply for funding under the MAHLF program. All loan requests undergo the same level of scrutiny and feasibility determination regardless of whether the applicant is a non-profit, public agency or private interest.

In determining whether a proposed project is eligible under the program, FP will consider the conditions of the local market served by the project, demonstrated need for the number of units proposed, as well as the housing type and bedroom configuration of the proposed units. In other words, FP attempts to determine whether the applicant has adequately assessed market demand for the proposed project and whether the end product addresses that demand.

While factors to determine whether a project is "affordable" may be quite subjective, there are certain tests which will help indicate whether a project is attractive to FP.