NFC Update

NFC Update

Presentation to Des Moines City Council ? October 27, 2021

1912 6th Ave Des Moines 515.246.0010

Stephanie Murphy smurphy@ 515.273.1372

Our Mission

NFC provides unique lending programs and related services to facilitate targeted neighborhood revitalization in Polk County and Cedar Rapids, Iowa through partnerships with residents, governments, community-based organizations and the business community.

NMLS #8943

History of NFC

NFC created in 1990 to improve Des Moines neighborhoods

Five neighborhoods were chosen and each neighborhood had a smaller "target area" where resources were to be focused

The original neighborhoods in 1991 were Beaverdale, Capitol East, Columbus Park, River Bend/North Park and Woodland Heights

Over-time NFC was asked to expand to more neighborhoods

Current Des Moines Lending Area

Urbandale

Windsor Heights

Des Moines

Special Investment Districts

West Des Moines

NFC Advantage Loans

Types of loans available:

Purchase

Refinance

Home Improvement

Front Porch Exterior

Every loan has a repayable loan and forgivable loan: 1st mortgage repayable loan is paired with a forgivable loan up to $10,000 that is funded through a 28E Agreement with the City of Des Moines & Polk County.

Subsidy is a 5 year forgivable lien against the property

Up to $10,000 per property every 10 years for improvements for renovation.

$20,000 is available for downsizing to a single-family home ? forgiven over 10 years.

No PMI ? 80/15/5 loan with a option for a 3% borrower/2% gift down payment.

NMLS #8943

NFC Funding Structure

Investor Capital

NFC has a current lending pool of $15M with 12 Financial Institutions in Polk County.

NFC sells some purchase and refinance loans and all of our home improvement loans to local Financial Institutions.

NFC sells $15 to $20M a year to Fannie Mae of purchase and refinance loans.

Local Government Funds

NFC receives $1M a year each from the City and Polk County (5 year 28E Agreements).

These funds are for forgivable loans to homebuyers and homeowners $2,046,726 in FY 2020. $9,303 per borrower.

Also use as Loss Reserves for Lending Pools.

Historically, NFC has recycled 45% of local government funding through repayment and not needing to use the loss reserves due to low delinquency.

Since 1991, NFC has provided $47.75M in forgivable loan funds in Des Moines.

NFC Raised Capital

NFC has received CDFI funding for our Front Porch Exterior Repair Program. FY 2020 - $521,190 for 29 homeowners.

Utilize CDFI funding for 2% interest 2nd mortgages. In FY 2020 - $985,678.

Use NeighborWorks funding & other funds raised for Neighborhood Reinvest Down Payment Program. In FY 2020 $330,500 for 32 homebuyers.

FY 2021 NFC Lending

July 1, 2020 to June 30, 2021

Neighborhood Finance Corporation Lending in Des Moines Summary

Forgivable Loan

Renovation

Loan Type

# of Loans # of Households Loan Amount

Amount

Amount

Purchase

57

57

6,625,394

624,425

934,490

Refinance

108

108

12,784,185

1,049,043

3,018,920

Home Improvement

26

26

977,485

220,020

1,152,292

Front Porch Exterior Repair

29

29

521,190

153,238

643,487

Tandem Second Mortgage

70

985,678

-

-

Down Payment Assistance

32

330,500

-

-

Total

322

220

$

22,224,432 $

2,046,726 $

5,749,189

NFC Lending by Ward

Ward 1 Ward 2 Ward 3 Ward 4

# of Households 91 69 44 16

Total Investment Total Renovations

10,277,462

2,600,573

7,407,765

1,232,008

5,358,761

1,586,234

1,227,170

330,374

Information on NFC Lending

Purchase, Refinance and Home Improvement Loans are sold to Investors (Local Financial Institutions or Fannie Mae)

NFC self-funds the Front Porch, Tandem Second

Mortgage and Down Payment Assistance.

Total Des Moines

220 $

24,271,158 $

5,749,189

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