CA AB2161

Authorizes the Department of Housing and Community Development to reinstate qualifying unpaid matured loans for rental housing developments in addition to existing authority to extend loans, subordinate debt, and invest tax credit equity.

Reinstated loans are treated as if extended from their original expired due date and must be governed by new regulatory agreements with terms of at least 10 years and not exceeding 55 years (or 58 years to match tax credit restrictions).

Sets interest rate at 3 percent simple interest with deferred payments except for residual receipts; allows department to charge monitoring and transaction fees with discretion to waive or defer fees for developments lacking ability to pay.

Permits rent increases for assisted units only when necessary for project feasibility and rehabilitation, with limits of 5 percent annually for existing tenants earning up to 35 percent of area median income and 10 percent annually for higher-income tenants.

Defines "qualifying unpaid matured loan" as loans in material compliance with all terms except having reached maturity without payment, or matured non-compliant loans being transferred to a department-approved borrower.