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Section 108 Loan Guarantee Program

 
Program
web site		 http://www.hud.gov/offices/cpd/communitydevelopmen
t/programs/108/index.cfm
Sponsor U.S. Department of Housing and Urban Development
Deadlines Applications accepted on an ongoing basis
Purpose Section 108 is the loan guarantee provision of the Community Development Block Grant (CDBG) program. Section 108 provides communities with a source of financing for economic development, housing rehabilitation, public facilities, and large-scale physical development projects. This makes it one of the most potent and important public investment tools that HUD offers to local governments. It allows them to transform a small portion of their CDBG funds into federally guaranteed loans large enough to pursue physical and economic revitalization projects that can renew 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. Section 108 loans are not risk-free, however; local governments borrowing funds guaranteed by Section 108 must pledge their current and future CDBG allocations to cover the loan amount as security for the loan.
Eligibility Eligible applicants include the following public entities:
  • metropolitan cities and urban counties (i.e. CDBG entitlement recipients);
  • nonentitlement communities that are assisted in the submission of applications by States that administer the CDBG program; and
  • nonentitlement communities eligible to receive CDBG funds under the HUD-Administered Small Cities CDBG program (Hawaii). The public entity may be the borrower or it may designate a public agency as the borrower.
    • Geographic
    coverage    		 Nationwide
    Amount of
    funding    		 Amount not specified. See Program web site for loan details.
    Application
    process    		 If you are interested in applying for a Section 108 Guaranteed Loan, contact your local HUD office* in advance for help in preparing an application. The program has no forms, but the following is the process required (as described in http://law.justia.com/us/cfr/title24/24-3.1.1.3.4.13.1.5.html application requirements. The length of time the application approval process takes depends on the individual application.
     

    For more information contact:
    For questions on a specific application, contact your local HUD office or the staff underwriter in HUD headquarters who is reviewing the application.

    For more information on the CDBG Section 108 loan guarantee program, your local HUD field office* will be able to assist you. When applying for a Section 108 loan, the field office is the first to become involved in reviewing the application.

    You can contact the Section 108 office at HUD headquarters in Washington, D.C. at 202.708.1871* or 202.708.1506*, or by mail at:

    Section 108 Loan Guarantee Program
    Office of Community Planning and Development
    U.S. Department of Housing and Urban Development
    451 7th Street, SW Room 7206
    Washington, D.C. 20410

    For technical guidance, contact Mr. Paul Webster, Director, Financial Management Division, at the above address or at 202.708.1871* or Mr. Nelson R. Bregon, Deputy Assistant Secretary for Grant Programs, Office of Community Planning and Development, at the above address or at 202.708.1506*.

    Summaries of funding programs are provided by RAC for your convenience. Please contact the funder directly for the most complete and current information.