Assembly Bill 1699 (AB 1699) was enacted in 2012 and authorized HCD to restructure existing loans in specified HCD loan programs. The Department adopted Amended LPR Guidelines effective June 9, 2026, implementing the provisions of AB 2562, AB 130, SB 686, and SB 21. These amendments expand eligibility to Multifamily Housing Program (MHP) loans, introduce provisions for Extracted Equity transactions, add SB 21 compliance requirements for single-room occupancy (SRO) units, and establish a revised fee structure.
Legislative Authority
- AB 1699 (2012): Original authorization for HCD to restructure existing multifamily housing loans under specified legacy programs.
- AB 2562 (2018): Expanded eligibility to include all loans funded or monitored by the Department and allowed an interest rate reduction where necessary for syndication.
- AB 130 (2025): Authorized the use of extracted (excess) project equity for qualified purposes (Health and Safety Code Section 50406.4).
- SB 686 (2025): Expanded the eligible uses of extracted equity to include reimbursement of certain borrower advances.
- SB 21 (2025): Established parameters for single-room occupancy (SRO) conversions (Government Code Section 66300.6).
Key Updates
- Expanded program applicability
- Extracted Equity
- SRO conversions (SB 21)
- Early payoff
- Revised fee structure
For information on Extracted Equity Provisions (Section 109) and SB 21 / SRO Conversions (Section 108), visit the LPR Guidelines page.