ALFAH Section 108 Loan Program
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Affordable housing developers and owners have the opportunity to apply for loans through the City of Detroit’s ALFAH (Affordable Loans for Affordable Housing) Section 108 loan program to support projects that advance the City’s goals of affordable housing production and the creation or stabilization of healthy mixed-income communities with a rich array of amenities and strong local economies. HRD is making up to $75,000,000 of funding available through lower-interest loans that must be repaid to support the preservation and construction of affordable housing, and to reduce the barriers to housing development. This is not a gap financing program.
Section 108 is a loan guarantee program administered by the Department of Housing and Urban Development (HUD) specifically for recipients of Community Development Block Grant (CDBG) funds, such as Detroit. Section 108 loans are low-cost or lower-cost flexible financing that can be used to support economic development, housing, and other projects. In 2025, Detroit applied for and received approval for a $75 million loan pool focusing on affordable housing development. HRD has released a Notice of Funding Availability (NOFA) for developers seeking individual loans within that pool. These funds must be used for CDBG-eligible uses and comply with CDBG regulations.
This NOFA offers four different loan products to meet the needs of a variety of development stages, financial circumstances, and project types. Basic details on the four loan types are:
Loan Type | Eligible Use | Suggested Project Type |
|---|---|---|
Acquisition Short-Term Loan | Acquisition | Vacant residential & mixed-use buildings |
Acquisition Mini-Perm Loan | Acquisition & other soft costs | Occupied rehabilitations of residential/mixed-use properties |
Senior Construction-to-Permanent Loan | Acquisition, hard and soft costs; New construction if CBDO | LIHTC projects with project-based assistance or other financing requiring Davis-Bacon compliance |
Tax Equity Bridge Loan |
Resources:
- ALFAH Section 108 Developer Meeting slide deck
- ALFAH Section 108 Developer Meeting recording
Application expected to open in May.
For questions related to this program, please contact: [email protected]