The Rural Satellite Broadband initiative has been structured as a component of a HUD Home Loan Program for First Time Buyers. The Home Loan generates passive interest income, which is used to fund the Satellite Broadband costs. In particular, Clarendon Foundation provides home construction financing for first time home buyers in rural communities, and uses the interest earned to pay for the satellite broadband equipment and service. The Foundation is able to support two public policy objectives by its innovative self-funding program.

Due to the current economic crisis, potential homeowners have found that acquiring construction funding (that is later replaced by FHA in a long term home loan) is very difficult to obtain. Without this initial funding, which Clarendon Foundation is stepping up to cover, the loan may not ever be processed.

FHA through local banks makes 30 year fixed financing available to qualified first time homeowners. Even though this type of financing was readily available prior to the current economic crisis, many homebuyers are frustrated to learn that construction lending in today’s tight financial markets can keep otherwise qualified borrowers out of the market. This financing problem is more acute for rural areas, where much of housing is built as a pre-manufactured home upon a concrete foundation.

The FHA is now providing special incentives, such as federal income tax credits for first time home buyers. Clarendon Foundation will assist the new borrower through the maze of home ownership.

New home borrowers can obtain an application for the Satellite Broadband and HUD First Time Homebuyer Financing Program by contacting the Clarendon Foundation. Resources are limited and applications will be reviewed on a first-come, first-serve basis.

Applications are reviewed by a qualified Loan Committee. The location of the home is checked for Satellite Broadband connectivity. To guide the Loan Committee, Clarendon has designed a matrix to check qualifications of the applicant. Any application must be accompanied by an FHA underwritten approval on the long-term mortgage.

The application will include information on the Contractor and the Mortgage Lender.

After review and recommendation by the Loan Committee, the application must then be approved by a majority vote of the Clarendon Board of Directors.

As required by HUD, the home is subject to multiple onsite inspections through a third party inspection agent 3 - 4 times during construction. The reception equipment for the satellite broadband service will be professionally installed.

Clarendon Foundation’s comprehensive program is intended to assist first time home buyers, who could not otherwise be able to access broadband Internet service.