Case study: Selling affordable housing loans in the secondary market
Abstract: The California Community Reinvestment Corporation (CCRC) is a nonprofit Community Development Financial Institution (CDFI) formed by a consortium of California commercial banks in 1989 to provide permanent mortgages for affordable housing projects. Historically, CCRC has funded its mortgage program through a credit line provided by its fifty member banks, but it has bumped up against its credit limit as it has increased loan production. One solution to this problem has been selling loans to free up credit-line availability for new loans. CCRC had bad experiences with early efforts to sell loans to federal agencies. But in the late 1990s, it returned to this strategy when it again outran its credit availability. CCRC and the insurance industry?s consortium, Impact Community Capital, partnered on a loan sale that included twelve loans totaling $40 million, which sold at an aggregate price of par.
File(s): File format is application/pdf http://www.frbsf.org/publications/community/review/062006/vine.pdf
Provider: Federal Reserve Bank of San Francisco
Part of Series: Community Development Investment Review
Publication Date: 2006