Housing Bond Financing

Description

The Quad Cities Regional Economic Development Authority (QCREDA) acts as the issuer of the bonds, passing its DOUBLE tax-exempt status on to a a Developer, private for-profit or not-for-profit to finance low-income or senior housing projects. The bond can include the acquisition of fixed assets including land, buildings, and equipment. Because the interest on the bonds is not subject to state or federal income taxes, investors and lenders require a lower interest rate to achieve an equivalent after-tax return. Therefore, the borrower receives a preferential interest rate, generating substantial savings.

Eligibility

Affordable housing

The Developer must agree to set aside a portion of a financed project’s units for tenants at a certain income level. A minimum of 20% of the units must be set aside for individuals earning no more than 50% of the area median income or the Developer can option to set aside 40% of the units for individuals earning 60% of the area median.

Fund Usage

Funds can be used to build a facility, acquire necessary land and new equipment. Funds can be used to acquire an existing facility as long as 15% or more is used to rehab the structure.

Housing Tax Credits

Housing bonds can assist in obtaining Low Income Housing Tax Credits (LIHTC) that can reduce the required equity.

60 Day notice

Funds expended prior to sixty days before receiving initial approval from QCREDA may not be eligible.

capital improvements

The capital improvements must take place in the territory of QCREDA in the counties of Carroll, Henry, Jo Daviess, Knox, Lee, Mercer, Rock Island, Stephenson, and Whiteside.

Benefits

Lower Interest Rate  

An QCREDA Double Tax Exempt Bond is exempt from state and federal income taxes, making it an attractive investment for the bondholder. The interest rate available on these bonds is far lower than conventional financing, and the borrower can expect an interest savings to range from 150 – 300 basis points lower than a conventional loan.

100% Financing

Finance up to 100% of the project cost – contingent upon meeting credit standards of a lender backing the bond.

Smooth Process

QCREDA has been described as a “Nimble Issuer” because of its flexible guidelines and an expedited approval process. We can assemble a team of Bond specialists who have a thorough understanding of all the legal and financial aspects of this type of transaction. We'll work closely with you every step of the way, answering your questions, helping you avoid pitfalls, and making sure you get the financing that's right for you.
Apply Here!