The Fund makes loans available for the rehabilitation of historic properties and other preservation work. Loans are not available for the purchase or acquisition of properties.
Loans made by the Fund are not permanent financings. As soon as the work is complete, and trades people have been paid out, owners are encouraged to seek conventional finance to allow the Fund’s limited resources to be allocated to other projects. The facility was originally conceived as a revolving fund, with all proceeds from previous loans returning to the funding pool.
To initiate a loan application you need to fill out a simple one page inquiry form. There is no charge for this. Once this form is receive the Fund runs a credit check and reviews the information provided. If the Fund’s preliminary criteria are met the inquirer is invited to make a formal application. A one-off non-refundable fee of $100 is required for the application.
Eligibility The following criteria have been adopted for the assessment of loan applications. Considerations are not limited to these criteria, and not all criteria need to be met. The Fund’s Board will weigh up the various factors applying to each individual case.
- Architectural and historic significance
- Demonstrated threat to the resource
- Project compliance with Secretary of the Interior’s standards
- Financial viability of the project
- Likelihood of the project not being qualified for conventional funding
- Availability of other funding sources to compliment those of the DPF
- Assessed risk, based on applicant’s credit history and the security offered for the loan
- Availability of funds
- Geographical distribution of projects within the State
In assessing risk the borrower’s credit history and financial circumstances are taken into account. The Board must be satisfied that the applicant is reasonably capable of meeting monthly payment requirements and, ultimately, of repaying the loan.
Terms Generally terms are flexible and can be tailored to individual circumstances. The primary concern from the Fund’s point of view is that as many historic properties as possible benefit from the Fund’s resources.
Loans are offered at below market rates, usually one point below, depending on the circumstances of the individual case. The lower interest rate is offered as an incentive to get any necessary protective work done sooner rather than later. Additional discounting may be offered to those of more limited means. Bad credit is not necessarily an obstacle to obtaining a loan from the Fund, though the Fund needs to be reasonably confident it will get its money back.
As a rule loans are offered for a maximum of three years. Terms are negotiable. People may pay interest only with a balloon (lump sum) payment at the end of the term. Or they may pay a mix of principal and interest.
Loans must be secured by a mortgage over the property. The mortgage may be a second or third mortgage, depending on the assessed risk.
Funds are made available on a draw down basis. Funds are only released as invoices are submitted for work done. There are no cash advances. Inspections may also be required to ensure that the completed work complies with the Secretary of the Interior’s standards. Local code requirements must also be met.