COMMUNITY DEVELOPMENT INVESTING: March 2000
SOCIAL TOPICS (Archive): COMMUNITY DEVELOPMENT INVESTING
New Hampshire Community Loan Fund
Published, March 2000
by Betsy Black
After a year of legal wrangling and waiting, the 50 families at the Exeter-Hampton Cooperative declared themselves proud landowners. Elated cooperative leaders closed on the deal on September 1, 1999. Their story illustrates how perseverance, vision and credit availability can make a difference in people’s lives.
In 1998, the families who live in this southeastern New Hampshire community banded together because the manufactured housing park where they live was for sale. “Manufactured homeowners in parks are on the lowest rung of homeownership; they own their home but rent the land,” says Loan Fund program manager Paul Bradley. With nearly every park sale to an outside investor, the rent homeowners pay for land increases. The residents here decided they couldn’t afford to let this happen; nearly three quarters of the residents are low income and one quarter are living on fixed incomes. “By forming a cooperative to jointly own the land, residents gain security that most homeowners take for granted,” Bradley continued. In 16 years, 42 resident groups in New Hampshire have bought their parks and now own nine percent of the state’s parks.
“In 1989, the New Hampshire Legislature endorsed cooperative ownership by passing a residents’ right of first refusal — an important law which was upheld by the New Hampshire Supreme Court in this very case after the purchase was challenged by a jilted buyer,” said Bradley.
The New Hampshire Community Loan Fund (NHCLF) helped the cooperative with a deposit loan of $35,000, a pre-development loan of $3,200 and finally with $251,000 acquisition loan. (A local bank loaned the rest.) The Loan Fund also provides technical assistance, training, and encouragement to the new cooperative owners.
NHCLF is the oldest statewide loan fund in the country and one of the first certified community development financial institution’s designated by the U.S. Department of the Treasury.
Since its founding in 1983, the NHCLF has loaned nearly $20 million to more than 275 community initiatives throughout New Hampshire. This lending is possible because individuals, religious organizations, foundations and other private sources have made over 500 investments in the fund totaling $9.7 million.
The NHCLF operates as a bridge, bringing capital from its investors to community projects that use debt to make their neighborhoods better places to live. The NHCLF helps individuals and families with low incomes obtain basic needs like housing, child care and employment. Nearly 98 percent of funds loaned to borrower groups have been repaid, making the funds available for other initiatives.
Loans vary by circumstance and need. In December 1999, for example, a woman who cares for her grandchildren in her rural home received a $1,590 loan. With it she bought fencing to keep her grandchildren safe from straying out of her yard onto a busy road.
Large or small, the loans made by the NHCLF help people who cannot access conventional debt. And as NHCLF’s Betty Johnson notes, “Our work is possible only with the investments of people who want to help others help themselves.”
Betsy Black, capitalization director since 1992, does public relations, communications and fundraising for the New Hampshire Community Loan Fund.
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