Community Foundation invests in Island Loan Fund to foster more access to housing

Submitted by OPAL.

The Island Loan Fund, a new program created by OPAL Community Land Trust, makes it possible for islanders who are creditworthy, but not yet eligible for a bank loan to access construction and mortgage financing. The Orcas Island Community Foundation has become the lead investor in the second pool of funding for OPAL’s new program.

Last year, seven local individuals invested a total of $300,000 at interest rates of 2 to 2.5 percent. OPAL pooled that money and then made the first loan to a local contractor who converted a small building on land he owned into a habitable home for his daughter and himself. The loan was repaid when the contractor received permanent bank financing, and OPAL made a second loan to another contractor who also needed a construction loan to build his own home.

“These are situations that fall just outside the bounds of today’s bank standards,” said Julie Brunner of OPAL. “We have more flexibility and can make loans that bridge a period of time until folks can refinance with a traditional bank.”

OICF has invested $150,000 for seven years with the goal of helping to maintain the island’s economic diversity. The community foundation will receive annual interest payments and at the end of seven years can re-invest or get its investment back.

“The Island Loan Fund is a creative way to invest assets so that the island continues to be home for people who make this community what it is,” said Hilary Canty, executive director of OICF. “The foundation is using part of the legacy gift left to OICF from Bob Henigson as Bob was a strong advocate for housing and equity. The OICF board hopes this investment inspires others to invest too.”

OPAL created the Island Loan Fund with grant funding from OICF, the Catholic Campaign for Human Development and others to fill a need for financing on the island. Local bankers are often frustrated that their bank’s underwriting standards do not allow them to make loans. Examples include the erratic income of people who are self-employed or a property that falls outside of the bank’s standards. The Island Loan Fund operates in accordance with state and federal laws on private securities offerings and consumer lending. The program is modeled after other loan funds in the U.S.

You can read more about the fund online at