The objective of the Construction Loan Guarantee Program is to provide construction loan guarantees to Participating Lenders for contractors who build affordable single family housing in communities with a documented need for additional affordable housing in their area.
- Under the Program, SDHDA will guarantee up to 50% of the total construction loans made to an individual contractor. The construction loan provided by the lender cannot exceed 85% of the total value of the house or cost of construction (including lot and improvements), whichever is less.
- SDHDA will not guarantee more than 5 housing units under construction, and not sold, by an individual contractor at one time.
- There cannot be more than 25 guarantees active in any one community.
- The maximum sales price cannot exceed limits established by SDHDA.
- There is a 0.5% guarantee fee charged by SDHDA. The guarantee expires one year after closing the construction loan.
- If you are interested in obtaining more information on this Program, please contact us.
- Construction Loan Guarantee Program Plan and Application