Not long ago, Marion Yates, 83, moved into an inexpensive apartment in a new Arlington County building whose low-interest construction loan came from a quasi-governmental agency called the Virginia Housing Development Authority.

Last month, however, the City moved a moderately priced, $31,000 Silver Spring condominium town house, part of a housing development whose purchase and rehabilitation loans were supplied by a similar housing finance agency in Maryland.

If Byers and Yates had tried to find low cost housing through such a housing finance agency in the District of Columbia, they would have struck out. The city has no agency compared to those in Maryland and Virginia.

Two weeks ago, however, the City Council passed legislation that would set up a housing finance agency - six years after a special commission first recommended that it be done.

"Finally," said Marianne Freeman, clerk to the council's committee of the whole and an expert on the new legislation, "D.C. is joining the rest of the country."

Housing finance agencies are familiar to most of the rest of the country. Nationally, they have provided hundreds of thousands of housing units for low-income families and the elderly. They have supplied an incentive for the development of the kind of shelter often spurned by private lending institutions more interested in underwriting middle- and upper-income level houses and condominiums.

The agencies go by different names, but they operate in basically the same way - as self-supporting agencies that issue tax-exempt revenue bonds to finance construction and permanent mortgage loans for housing at below market interest rates. In the case of apartment buildings, federal programs provide subsidies so that tenants pay no more than one-fourth of their income for rent.

As of September 1977, the 34 states with housing finance agencies had issued long-term bonds totalling more than $10 billion to finance about 400,000 units of housing, according to the 1977 annual report of the Council of State Housing Agencies.

"HFAs have been doing a large volume of business," said Dana A. Cohoon, research director for the council. "They've really been providing some housing that's needed."

Byers, who lives in Silver Spring's Glen Briar project, works for the U.S. Catholic Conference, and paid $31,300 for his three-bedroom condominium town house. "Most of us at that time had very little chance of getting into the home owners market," Byers said. If it hadn't been for Glen Briar, he added, "I'd still be in an apartment." His neighbours in the project include firemen, a policeman, government workers, young doctors and lawyers, and about 50 children, he said.

Montgomey County's Housing Opportunities Commission bought and rehabilitated Glen Briar about three years ago with a $2 million loan from the Maryland Community Development Administration, the state's housing finance agency.

"There is no question that without their help we couldn't have purchased it," said Ted Baldwin, chief of development and planning for the commission. "There was no other source of funds, particularly no source that would have allowed us to move as quickly as we did."

States vary in their use of the agencies. Some finance only rental housing. Some concentrate on rural areas, others on inner cities. Minnesota and Virginia finance single-family and multifamily buildings, home improvements and housing for the mentally retarded and handicapped. New York state finances hospitals, nursing homes and dormitories, in addition to other kinds of housing.

Much of the financing has been for project for the elderly - often the most easily accepted form of subsidized housing by surrounding neighborhoods. But officials at the U.S. Department of Housing and Urban Development have urged housing finance agencies to produce more housing for low-income families, rather than just for the low-income senior citizens, and to provide more rehabilitation money to neighborhoods and homeowners with the greatest need.

"Everybody likes the elderly. They don't create problems in neighborhoods. They don't have children who tear up buildings," noted Neil Churchil, HUD's housing program specialist for state and local programs. "Both HUD and the housing finance agencies have been doing elderly housing. Now, we have to do the hard things."

The new D.C. agency is modeled after one in Massachusetts because it is considered one of the best in the country and has produced more housing for the type of families that the District want to help, according to Freeman and Eric Ragir, a third-year law students who helped put together the legislation. In Massachusetts, at least one-fourth of all the apartments in projects financed by the agency must be rented to low-income people.

The Massachusetts agency has been responsible for more than 37,000 apartments since 1970, since Joy Conway, director of program development and public information for Massachusetts housing finance agency.

"Our aim is to get housing that will attract middle-income people and help the poor as well," Conway said. "If you passed our housing, you would think it was conventional housing - they look like luxury buildings. We don't have low-income wnigs and moderate-income wings."

The D.C. legislation is a compromise between bills introduced by Council Chairman Sterling Tucker and Council member Nadine P. Winter (D-Ward 6), who chairs the housing committee.

Under it, below-market interest loans can be channeled to developers who agree to set aside specific sections of their apartments and homes for families with low and moderate incomes.

In addition, the agency can finance construction, rehabilitation, refining housing purchases and conversions to condominiums and cooperatives. Its primary funding sources are the tax-exempt revenue bonds issued by the agency, rent or interest subsidies from the federal and city governments and the fees and interest earned by the agency's reserve funds. The money the agency raises through selling bonds or notes will not be counted against municipal debt.

Because it hasn't had a housing finance agency, the District has lost out on some housing benefits. For example, the Maryland and Virginia agencies picked up $4 million in federal rent assistance payments during the last fiscal year. Housing finance agencies also receive faster processing of rent subsidy applications, according to a council report on the legislation.

And, the report continued, assuming a revenue bond issue of $50 million and an average mortgage amount of $30,000, more than 1,500 units of new and rehabilitated housing could be generated. That and more is needed annually in order to meet the city's projected needs for housing through 1985, the report said.

The new legislation authorizes the housing agency to have a nine-member board of directors appointed by the mayor with the consent of the City Council.

Marion Barry, the Democratic nominee for mayor this year, is a strong supporter of the agency and has said he will urge subsidizing the purchase of vacant, single-family government-owned homes through it.

John L. Wilks, campaign manager for Republican mayoral nominee Arthur A. Fletcher, declined to say specifically at this point whether Fletcher supports such an agency. Wilks said Fletcher will outline his housing platform soon. 'He sees the housing problem as a money problem. We're interested in looking for an expanded money base for housing that will go beyond the housing finance agency," Wilks said.

The new D.C. agency will differ cause it can provide "anti-displacement rehabilitations," noted James from those in many other states be-Vitarello, who served as executive director of the D.C. Neighborhood Reinvestment Commission.

"We'll be able to stem displacement by using a lot of existing housing that is being underutilized, and at a relatively low cost," Vitarello said. He added that another unusual feature of the D.C. agency is that, instead of emphasizing all new construction or all low-income projects as in some other states, the housing finance agency here will promote a mix of housing within each project.

Agency-financed projects, particularly those that are to house low-income families, often are opposed vigorously by residents of nearby communities. Last year citizens in three Fairfax County neighborhoods tried hard to block construction of Rolling Road Estate, a town house development of 100 subsidized units in Springfield. The Fairfax County Board of Supervisors also voted its disapproval of the project. But, when threatened with a cutoff of its community development funds from HUD, the board withdrew from that position.

Housing finance agencies have not always had smooth sailing. In the mid-1970s when the bond market was in bad shape, many states had problems. In Massachusetts, the state had to bail out its agency in 1975 by passing emergency legislation that authorized up to $500 million in short-term notes guaranteed by the state. The agency has nearly paid off those notes, Conways said.

New York, which began the first housing agency in the early 1960s, has had tremendous financial problems in the past. HUD moratoriums during the early 1970s also stopped many housing starts in most states.

Housing finance agencies are now more cautious in their operations, Cohoon said, and are generally thought to be doing a better job of providing housing.

Nathan S. Betnun, assistant director for financing and policy for the Maryland Community Development Administration, has written a book about housing finance agencies, which grew out of his doctoral dissertation at the Massachusetts Institute of Technology. Betnun found that nationally, the agencies have been more effective than HUD in producing housing that satisfies public purposes.

The Maryland agency has financed 6,000 apartments and 2,300 single-family homes in the state since it began operation in 1974, Betnun siad.

Virginia's housing finance agency has committed funds for 22,834 apartments and homes, according to John Ritchie, executive director of the Virginia Housing Development Authority. Ritchie said the amount is split almost evenly between low-and moderate-income housing for the elderly and families.

Lois M. Rettie is head of the board of trustees for the Arlington Teachers Retirement Corp., which sponsors the Woodland Hill apartment building on Carlyn Springs Road where Marion Yates now lives. Rettie recalled that it was quite a struggle to get the subsidized project built.

First, they had to find land "that wasn't already grabbed up by other people or too expensive" in land-scarce Arlington County. Then, over the years, the organization had to fight to get changes in zoning regulations so the building could be constructed and then fight initial community opposition to a subsidized project in the midst of their neighborhood.

Now, however, Rettie said she can look at the modern seven-story structure, built with a $7.85 million loan from the state housing agency, and get "a very great sense of satisfaction to see that it's come this far."

Marion Yates said she loves her new home. Five years ago, when her husband died, she left their home near St. Elizabeths Hospital in Southeast Washington and began living with her 11 children scattered about the area, spending six weeks at a time with each of their families.

Now, Yates, who said she's always been independent, has her own one-bedroom apartment.