July 30, 2008
Investing to Empower Homeowners
by Anne Moore Odell
The Calvert Foundation partners with Habitat for Humanity to offer investors a vehicle to drive
homeownership while also receiving a financial return.
Habitat for Humanity International and the
Calvert Social Investment
Foundation recently launched a new program to create homes for families in need across the
globe while, at the same time, offering investors a solid investment platform. The Calvert
Foundation is hoping to raise up to $10 million, as the two well-known non-profits join their
know-how, helping even more families experience homeownership.
Investment Program is offered through the Calvert Foundation's Community Investment Note. Investors
can choose the term of the investment, anywhere from one to ten years. Investors can also decide
the interest rate, up to 2%. The investment monies go to Habitat for the Humanity International,
who will then lend the money to their local affiliates and partners for the purpose of building and
renovating more houses.
Starting in 1976, Habitat for Humanity has been working in local
communities to build and remodel affordable homes, offering no interest mortgages to homeowners. To
date, more than one million people have been served by Habitat for Humanity, with over 250,000
house built worldwide.
"The vast need for decent, affordable housing in our world means
that we have to be creative in our response to it, while staying true to Habitat's mission," said
Jonathan Reckford, CEO of Habitat for Humanity International. "This exciting opportunity with
Calvert Foundation will generate more capital to help further that mission. As supporters invest in
the Habitat Investment Program, we will be able to strengthen our capacity, which, in turn, will
allow us to invest in more families as together we build simple, decent homes worldwide."
Investors have the opportunity to reinvest their principal and interest at the end of their
terms or to donate their interest to Habitat for Humanity as a tax-free donation.
last 12 years, the Calvert Foundation has helped raise over $140 million in comparable Community
Investment Note programs, with over 12,500 affordable homes built. The Calvert Foundation backs up
all loans made to non-profit organizations, like Habitat for Humanity, through a variety of
safeguards, protecting investors' capital.
The Calvert Foundation's model is to combine
social and financial returns by using investment capital to help fund non-profits. This new
Habitat program fulfills Calvert's model. The Habitat Investment Program, however, is a new
direction for Habitat as they work to expand their strategies to get more families into homes. In
the past two years Habitat has doubled the number of families it has been able to serve from 24,000
families in 2006 to 49,000 in 2007.
Habitat for Humanity will work to fundraise the
interest paid on the loans. No cost of the interest paid on the loans will be passed on to the
Unlike the many of the loans made by subprime mortgage lenders, the loans made
by community investment programs that help low income people buy homes have an extremely high
repayment rate. Because of the due diligence and education offered by Habitat for Humanity and
other community investment programs, homes bought with their support are showing none of the same
foreclosure and repayment issues highlighted in past year. According to Habitat CEO Reckford, their
foreclosure rate is less than 1%.
Investors can take part in the program through the
Calvert Foundation or through their financial advisor with a minimum investment of $1,000.
Investors also have the opportunity to invest online in the Habitat Investment Program at www.MicroPlace.com with a minimum of $100.