Downtown Housing Loan

Downtown Housing Loans stimulate the production of market rate housing units by providing attractive, secondary financing. These loans are meant to fill the gap between available private and public sector funding, owner-provided equity, and the remaining financing needed to make the project feasible.

Frequently Asked Questions

Who can apply for Downtown Housing Loan?

Property owners and developers typically seeking secondary, gap financing for new or adaptive reuse housing development projects.

What is the target area of the loan?

Projects within Louisville’s Central Business District have priority, although those in adjacent edge neighborhoods are eligible depending on their potential impact to Downtown as a whole.

What is the maximum amount that I can borrow?

The maximum is usually $1,200,000.

Can the loan be subordinate to other debt?

Yes. Most loans are subordinate to a senior lender. The loans are also designed to work with developments that utilize Historic Tax Credits, Opportunity Zone investments, and other federal, state, and local development incentives, with the exception of Low-Income Housing Tax Credits or HUD loans.

What are the interest rates?

Interest rates vary depending on the complexity and risk of the project but are targeted to be below market and the senior lender’s rate.

What are typical loan terms?

– Loans should generally not exceed 10 years and amortization should not exceed 20 years.

– At the discretion of the Loan Review Committee, loans may include an interest-only period.

– Borrowers are expected to have a meaningful equity stake in the project.

– There must be sufficient collateral for the loan, and personal guarantees of the borrower(s) are required.

– There are no penalties for early repayment.

 Is there an application fee?

Yes, there is a non-refundable $500 application fee, payable when the application is submitted to partially recover the costs to process and underwrite the loan application.

How do I submit an application?

The application process begins with a preliminary discussion with our team to discuss the availability of funds and the applicability of the request.

For more information about the Downtown Housing Loan, please contact:

Frank Kalmbach, (502) 584-6000

Email Frank Kalmbach here