Financing

You can’t set out to help residents purchase their communities without providing the financial means to do so. That’s why ROC USA® established Resident Ownership Capital, LLC (or “ROC USA® Capital”), whose sole mission is lending to Resident-Owned Communities.

When residents learn their community is for sale, it’s logical to figure each household will need to pay an equal share of the purchase price. For example, if a 75-site community is selling for $2 million, it’s easy to see how homeowners would assume they would each have to pay more than $26,000 in order to purchase the community.

But by using the ROC USA model, homeowners form and join a cooperative association that borrows the money for purchase from ROC USA Capital. Each association member contributes a maximum $1,000 joining fee while their lot fees go toward paying off the mortgage and running the new business that is their community. Often, the rent goes up at the time of purchase and then remains relatively stable in the years that follow.

ROC USA Capital has financed 55 resident-owned community purchases with an average loan of $2.67 million. ROC USA Capital makes loans up to 110 percent of the community’s appraised value, as well as pre-development loans for upfront due diligence. That means homeowners in a for-sale community can borrow money to hire outside experts to assess the community and the purchase before deciding whether to buy. If they end up deciding against buying, they need not repay the loan as it can be forgiven.

Cooperative associations in 13 states have taken advantage of ROC USA Capital to purchase the land beneath their neighborhoods. To learn more, contact ROC USA Capital Managing Director Michael Sloss at (603) 724-8370 or msloss@rocusa.org.