We are an ISB. We booked a CRE loan financing the purchase of and secured by three rental apartment buildings. Two of the buildings are on the same lot and the third is a separate lot. Both locations are located in a Moderate Census tract. Between all three buildings, there are 13 units. All of the units are charging rents that are below the Fair Market Rent limits established by HUD for that location. Three of the units (23%) are receiving rental assistance from the City Housing Agency.
Would this loan, in your opinion, be eligible as a Community Development loan as it provides affordable housing to LMI population.
Any and all opinions requested and welcomed.

Yes, this loan as described here should qualify as community development for affordable housing.

How many units are in each building? If there is less than 5 units in each building would this be a multifamily property or would it be Single Family Dwellings? Can SFD be counted for CRA and HMDA or just HMDA?

If anyine of the buildings has five or more units it can be HMDA and Community development, which it seems there is to get to 13 units across three buildings.

Ok. Another question. Can we count the entire loan than? We have similar situations and it is great to know we can count for Community Development. We code the loan as a SFD given the majority of the property is SFD. Will that affect us being able to count the entire loan. Let's say 2 buildings have 4 units and 1 building has 5 units. Would we be able to count the whole $1million or would be have to split it between buildings? Curious

Here is the breakdown of units per building

Building A has 6 units

Building B has 5 units
Building C has 2 units.

Building B&C are on the same lot/legal description.

The loan amount is for $240,000.00.

And this is one note? And for HMDA did you code the loan as multi-family? (You select one property for multi-property loans).

Regardless, if you had coded this as a 1-4 family, I would put this in front of examiners.

You have to work through several layers. ISBs have freedom others do not. Check the Q and A. Search on HMDA.

I have to go finish up a submission and can't walk through this whole thing right now. I can come back to it later.

This is all one Note. It is coded for HMDA (although we are not required to report HMDA loans-no branches in an MSA)but since it is multi-family, I believe we can also code as CD as well as HMDA.

Your situation is pretty interesting and somewhat unusual. Normally SFR don't count toward Community Development. But if you undergo a CRA exam under ISB standards and you are not a HMDA reporter you can claim SFR's that are proven to be affordable and occupied by LMI tenants.

Since you aren't reporting these loans under either CRA or HMDA I would retain them as one loan for the entire amount.