How to Apply for a Loan With MHTF:
A Step-by-Step Guide

If you’re a developer or contractor in South Carolina looking to make a significant impact in the affordable housing sector, partnering with Midlands Housing Trust Fund (MHTF) can provide you with the financial leverage you need. This article serves as a detailed, step-by-step guide on how to apply for a business loan with MHTF.

Who Is Eligible?

Before diving into the application process, it’s crucial to understand who can apply for these loans. MHTF offers loans to:

Nonprofit organizations
For-profit businesses
Government entities
LLCs

The primary aim is to create and preserve affordable housing for households earning less than 80% of the Area Median Income in specific counties of South Carolina.

Types of Loans and Their Terms

MHTF provides three main types of loans, each with its own set of terms and conditions:
1. Bridge Loan

Maximum Term: Up to 12 months
Eligible Activities: Predevelopment, acquisition, rehab, and construction

2. Gap Loan

Maximum Term: Up to 24 months
Eligible Activities: Predevelopment, acquisition, rehab, and construction

3. Permanent Loan

Maximum Term: Up to 240 months
Eligible Activities: Predevelopment, acquisition, rehab, construction, and permanent financing
These loans are offered on a very limited basis

Financial Requirements and Incentives

Security and Collateral

Loans must be secured. Development loans may be secured by a commitment letter for construction financing, permanent financing, grant funding, a promissory note, mortgage, and personal guaranty

- Exception: MHTF may accept a written commitment of funds from a government entity or other reliable source as collateral if the purpose of the MHTF loan is to enable the borrower to fulfill the requirements for disbursing those funds

Security assurances include appraisal, environmental assessment, title insurance, liability and flood plain insurance, certificate of occupancy, and inspection

Debt Service Coverage

A minimum debt service coverage ratio of 1.20 is typically required, along with a pre-funded operating reserve for permanent loans

Loan Amounts

Minimum: $10,000
Maximum: Typically up to $250,000 or 50% of total loan capital

Interest Rates

Interest rates are flexible and may vary. Interest rate discounts may apply in some circumstances:

- Up to 0.5% for developments serving households at 80% of area median income and below
- Up to 1% for developments serving households at 60% of area median income and below
- Up to 0.5% for developments that are certified energy efficient by LEED, Green Communities, Earth craft, Energy Star, and NAHB

Step-by-Step Application Process

Step 1: Research and Planning
Before applying, ensure that your project complies with local planning restrictions and zoning ordinances. Your project should also aim to enhance the aesthetic quality of neighborhoods and minimize environmental impact. Please read these guidelines before moving forward with the application process.

Step 2: Read Application Instructions and Complete Development Pro Forma
Next, please download this form and read all of the application instructions in their entirety first. Then complete all sections of the application in the same order in which they appear. Please make sure all of the tabs within the document have been completed.

Step 3: Download and Complete the Application
After reading the guidelines and application instructions, and completing the Development Pro Forma, download the application form and complete the first page as instructed. Once you’ve completed that, move on to the application itself. Please fill out all sections of the application in the order in which they appear.

Step 4: Prepare Supporting Documents
Prepare the supporting documents necessary for your application. This includes appraisals, environmental assessments, title insurance, and more.

Step 5: Submit the Application and Pay the Application Fee
Applicants must submit one (1) hard copy of the application and all supporting materials or one (1) electronic (PDF) copy of the application and all supporting materials. The application materials must be accompanied by a $500 check for the non-refundable application fee. You can submit the forms via email or mail them to Midlands Housing Trust Fund, 1201 Main Street, Suite 1480, Columbia, SC 29201.

Step 6: Follow Up
After submission, it’s advisable to follow up with MHTF to ensure your application is being processed and to provide any additional information if required.

Applying for a loan with MHTF is not just a financial transaction — it’s a commitment to community development. By following this comprehensive guide, developers and contractors can not only navigate the application process with ease but also contribute to solving the affordable housing crisis in South Carolina.

For more details, please refer to MHTF’s official Applications and Policies page, download our full policies document, or contact us with any questions.

Interested in learning more about the benefits of investing in affordable housing? Midlands Housing Trust Fund can help! MHTF is dedicated to improving South Carolina communities by expanding access to quality affordable housing. We provide a variety of loan products to housing developers and contractors for the purpose of creating, rehabilitating, and maintaining affordable housing for households earning less than 80% of the Area Median Income.

Thanks to flexible lending limits and competitive loan rates, MHTF’s business model presents an attractive alternative to conventional retail banking. Since 2012, we are proud to have provided more than $3 million in affordable housing financing, thereby creating or preserving 512 housing units and improving the lives of over 1,200 individuals.

Empowering

Economically Distressed Communities

Creating Access to

Quality Affordable Housing

Leveraging

Federal Dollars Alongside Private Sector Capital