LIHTC Pro Forma & Capital Stack
Model your tax credit deal: eligible basis, credit amount, equity, gap financing, and debt service. Uses HUD FMR rent limits for your selected county. Results are illustrative — not a substitute for professional underwriting.
Screening tool only. Outputs are planning-level estimates based on simplified assumptions. They are not a substitute for lender underwriting, investor pricing, legal advice, or a CHFA-required market analysis.
Scenario Sensitivity
How key assumptions shift your deal outcome. Bars show the range of variation for equity proceeds, demand signal, and market saturation.
Housing Outcome Score
—Composite metric integrating need coverage, policy alignment, financial feasibility, and site quality across your full workflow.
What makes LIHTC deals actually hard
The tax credit program is the most effective affordable housing production tool in U.S. history — and one of the most technically demanding. Here is what the pro forma above does not show you.
Credit pricing is a market — and it moves
The equity price per dollar of annual credit (the "credit price") is determined by what tax credit investors will pay. In strong markets, this approaches $1.10–$1.15. In volatile periods, it can drop to $0.85 or below. A 10-cent swing on a $1M annual credit changes your equity by $1M. LIHTC equity closes 12–18 months after allocation, during which your project's financial structure is locked — but market conditions are not.
Eligible basis is not total development cost
Only "residential" costs qualify: construction, some soft costs, architect fees, developer overhead up to a limit. Land, commercial space, excess developer fee, and many financing costs are excluded. HUD's basis boost (130% in QCTs and DDAs) can add meaningful credit but requires specific HUD certification. The QCT/DDA overlay on the Housing Needs Assessment map shows your project's eligibility.
9% credits are competitive — not guaranteed
CHFA allocates 9% credits through a competitive QAP process. Colorado receives roughly $3.90 per capita in annual allocation authority — about $24M/year. A typical 60-unit LIHTC project needs $1.2–$1.8M in annual credits. Demand routinely exceeds supply by 3:1 or more. Applications score on: site control, readiness, community support, income targeting, green standards, nonprofit involvement, and design quality. Rejection does not mean the project is bad — it often means it is early.
The "gap" problem is structural
LIHTC rents are capped below market to serve low-income residents — which is the point. But lower revenue means lower debt capacity. The gap between total development cost and available financing (tax credit equity + first mortgage) is filled by: CHFA subordinate loans, HOME funds, CDBG, local housing trust funds, seller-carry notes, and deferred developer fee. Stacking these sources requires coordinated closings and subordination agreements. A typical 60-unit deal has 5–8 financing sources.
Compliance runs 30+ years
The initial compliance period is 15 years. The extended use period adds another 15 (30 total). During this time, units must be rent-restricted and income-qualified. Annual CHFA compliance audits, IRS Form 8609, tenant income certifications (TICs), and annual owner's certificates are all required. A compliance violation can trigger credit recapture — the investor gets back the credits they claimed, plus interest and penalties. This liability runs through the full compliance period.
Working with banks: CRA and the capital stack
Community Reinvestment Act (CRA) obligations incentivize banks to invest in affordable housing — either as LIHTC equity investors, construction lenders, or permanent lenders. Banks under CRA examination pressure are often the best sources of below-market subordinate debt. Identifying your local CRA lenders early — before allocation — can open financing that is not available through standard channels. See the lender guide below.
Finding CRA lenders for your project
Banks with Community Reinvestment Act obligations are among the most consistent sources of affordable housing capital — equity, construction debt, and subordinate permanent debt. The following Colorado-active lenders have established LIHTC and affordable housing programs.
This list reflects publicly reported CRA activity and program descriptions. Not an endorsement or guarantee of availability. Contact your CHFA relationship manager for current lender referrals before beginning preliminary conversations.