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HB5314 / File No. 110 1
General Assembly File No. 110
February Session, 2026 House Bill No. 5314
House of Representatives, March 23, 2026
The Committee on Banking reported through REP. DOUCETTE
of the 13th Dist., Chairperson of the Committee on the part of
the House, that the bill ought to pass.
AN ACT CONCERNING THE "HOMES FOR CT" LOAN PROGRAM.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Subdivision (2) of section 8 -265ccc of the 2026 supplement 1
to the general statutes is repealed and the following is substituted in lieu 2
thereof (Effective July 1, 2026): 3
(2) The loan shall (A) be secured by a mortgage deed on the eligible 4
borrower's residential buildings and all related improvements under 5
development by the eligible borrower, (B) be made in accordance with 6
the eligible financial institution's underwriting policy and standards, 7
except that the loan may have a loan -to-value ratio in excess of typical 8
underwriting standards, and (C) bear interest at a rate that does not 9
exceed the [applicable] prime rate [of the Federal Home Loan Bank of 10
Boston for short-term or long-term advances through the New England 11
Fund program. For the purposes of this subdivision, "applicable rate" 12
means the New England Fund rate that (i) is] published [on the Internet 13
web site of the Federal Home Loan Bank of Boston ] by The Wall Street 14
Journal as of the date the interest rate is locked in by the eligible 15
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borrower and eligible financial institution . [, and (ii) has an advance 16
term that most closely corresponds to the term of the loan being made 17
by the participating eligible financial institution.] 18
Sec. 2. Section 8-265eee of the 2026 supplement to the general statutes 19
is repealed and the following is substituted in lieu thereof (Effective July 20
1, 2026): 21
Under the program administered by the authority pursuant to 22
subsection (a) of section 8 -265bbb, the authority may, within available 23
resources allocated by the State Bond Commission, make loans or issue 24
grants-in-aid to eligible borrowers that are in addition to the loans made 25
to such eligible borrowers by eligible financial institutions pursuant to 26
section 8 -265ccc, as amended by this act . The loans made by the 27
authority (1) may be (A) amortizing, (B) deferred, or (C) forgivable as to 28
principal and interest, and (2) shall be [(1)] (A) subordinate to the loans 29
made by eligible financial institutions, and [(2)] (B) subject to such terms 30
as the authority may establish, including, but not limited to, loan 31
amounts, interest rates and terms to maturity. The grants-in-aid issued 32
by the authority shall be subject to such terms as the authority may 33
establish. 34
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2026 8-265ccc(2)
Sec. 2 July 1, 2026 8-265eee
BA Joint Favorable
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HB5314 / File No. 110 3
The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of
the General Assembly, solely for purposes of information, summarization and explanation and do not
represent the intent of the General Assembly or either chamber thereof for any purpose. In general,
fiscal impacts are based upon a variety of informational sources, including the analyst’s professional
knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final
products do not necessarily reflect an assessment from any specific department.
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 27 $ FY 28 $
Treasurer, Debt Serv. GF - See Below See Below See Below
Note: GF=General Fund
Municipal Impact: None
Explanation
The bill makes various changes to the Homes for CT program, a
portion of which is funded through General Obligation (GO) bonds .
Future General Fund debt service costs may be incurred or incurred
sooner due to the program changes to the degree that it causes
authorized GO bond funds to be expended or to be expended more
quickly than they otherwise would have been.
As of March 1, 2026, there is an unallocated bond balance of $ 10
million under the authorization. The bill does not change overall GO
bond authorization levels.
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to any bonds issued.
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OLR Bill Analysis
HB 5314
AN ACT CONCERNING THE "HOMES FOR CT" LOAN PROGRAM.
SUMMARY
This bill makes several changes to the “Homes for CT” loan program,
a Connecticut Housing Finance Authority (CHFA) -administered
program established under the FY 26 -27 bond act to help owners and
developers get funding to build new residential buildings. Under the
program, participating banks and credit unions make loans to eligible
borrowers and CHFA guarantees repayment, up to specified amounts.
The law also authorizes CHFA, within available resources, to make
additional subordinate loans to Homes for CT borrowers subject to any
terms it sets, such as interest rates and maturity.
The bill caps the interest rate participating lenders may charge under
the program at the Wall Street Journal prime rate on the date the
borrower and bank or credit union lock in the rate, rather than a
specified Federal Home Loan Bank of Boston (FHLBank Boston) rate on
that date , as current law requires . The current cap is the FHLBank
Boston’s New England Fund rate for short - or long -term advances ,
based on the advance term that most closely matches the loan’s term.
The bill also:
1. specifies that the CHFA loans to Homes for CT borrowers may
be amortizing, deferred, or forgivable as to principal and interest;
2. authorizes CHFA to make grants to Homes for CT borrowers,
subject to terms it sets; and
3. limits CHFA’s authority to provide these loans and grants to
available resources allocated by the State Bond Commission.
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By law, “Homes for CT” loans must be used for expenses needed to
complete residential building construction or build related
improvements that CHFA determines are necessary. The program may
issue up to $100 million in loans and pay up to $10 million to honor loan
guarantees. The FY 26-27 bond act authorizes up to $20 million in state
general obligation bonds for FYs 26 and 27 for the program.
EFFECTIVE DATE: July 1, 2026
COMMITTEE ACTION
Banking Committee
Joint Favorable
Yea 13 Nay 0 (03/10/2026)