ANAHEIM, Calif.--(BUSINESS WIRE)--The Change Company, America’s Community Development Financial Institution (CDFI), is pleased to announce that it has closed the first ever securitization of residential home loans originated entirely by a CDFI. Investors in the $297 million offering included socially responsible asset managers and banks seeking to finance home loans to credit-worthy Black, Latino, and low- and moderate-income borrowers and communities.
Jesse Elhai, Managing Director of Capital Markets for Change, said, “We are proud to be the first CDFI to securitize its own residential loans. This inaugural securitization validates the importance of the exemptions provided to CDFIs by the CFPB to fairly and responsibly meet the needs of minority and low-income borrowers under Regulation Z. We thank our new financial partners for helping us demonstrate that CDFIs are essential to ending structural economic inequalities in homeownership. Change will continue to expand its partnerships with financial institutions seeking socially responsibly investments that level the financial playing field for Black, Latino and low-income Americans across the United States.”
Steven Sugarman, Founder of The Change Company, said, “As we celebrate Black History Month, we are reminded that homeownership is the key to closing the racial wealth gap and achieving generational wealth. We thank our new financial partners who, through their investment in this securitization, are demonstrating their commitment to fair and equitable homeownership in America.”
This transaction follows the completion of a comprehensive assessment by Institutional Shareholder Services (ISS) which validated The Change Company’s Social Bond and Loan Framework. The analysis by ISS determined that Change’s proposed framework, mission-driven mortgage products, social lending, and inclusive business model, aligns with the Social Bond Principles established by the International Capital Markets Association and positively contributed to the Sustainable Development Goals defined by the United Nations.
Since 2018, Change has funded over $20 billion in loans to more than 50,000 families. Through future securitizations, Change will continue to enhance its ability to bank the underbanked, eliminate the wealth gap, and level the playing field for diverse homeowners and small business owners.
Cantor Fitzgerald and Performance Trust served as the initial purchasers and joint bookrunners on the transaction. Dentons US LLP served as issuer counsel to Change Lending and Hunton Andrews Kurth LLP served as underwriter counsel in the transaction.
About The Change Company
The Change Company empowers homeowners, small businesses, and consumers to pursue their American dreams by bringing social and racial equity to banking and lending. The Change Company’s team has built businesses that have lent over $50 billion to over 250,000 borrowers and provided financial services to over two million Americans. For more information, visit us at www.TheChangeCompany.com and www.ChangeFi.com.
About Change Lending
Change Lending seeks to expand homeownership by providing credit-worthy loans to prime, underbanked borrowers. Since becoming a CDFI, over 70% of Change Lending’s loans have been to Black, Latino, and low- and moderate-income borrowers and communities. For more information, visit us at www.ChangeMtg.com and www.ChangeWholesale.com.
No Offer or Solicitation
This press release does not constitute an offer to sell, a solicitation of an offer to sell or the solicitation of an offer to buy any securities. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. The Notes were offered and sold only to accredited investors and to qualified institutional buyers. The Notes have not been and will not be registered under the Securities Act or the securities laws of any other jurisdiction. Unless they are registered, the Notes may be offered and resold only in transactions that are exempt from registration under the Securities Act and applicable state securities laws.
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