Main Street Mortgage Loan Program

A partnership between Main Street Iowa, the Iowa Finance Authority (IFA) and the Federal Home Loan Bank of Des Moines, the Main Street Mortgage Loan program provides funds for lending to Main Street communities in Iowa. IFA, as an associate member of the Federal Home Loan Bank of Des Moines, can borrow from the Federal Home Loan Bank at favorable rates and loan that money to aid community development projects. Main Street Iowa has identified a need for mortgage lending for multifamily housing and commercial development in Main Street communities. Specifically, there is a need for downtown infill and rehabilitation of upper floor housing in mixed-use buildings.

Eligibility
Loans are made for the rehabilitation of upper floor housing or commercial properties or for new construction on infill lots in downtown areas of communities that particpate in the Main Street Iowa program.

Projects must complement Main Street Iowa's vision of a revitalized downtown. Main Street Iowa first considers all applications for design appropriateness. If approved, IFA then reviews the applications for underwriting purposes. IFA awards loans on an ongoing basis.

Loan amounts 
The maximum loan amount is $250,000 per commercial project. The minimum loan amount is $50,000.

Interest rates and terms
Loans for this program may have terms between 3 and 15 years with up to a 30-year amortization. The interest rate is fixed at 1.35 percent above IFA's cost of funds for the proposed loan term.

Debt Coverage Ratio
1.25 : 1, inclusive

Loan Criteria
The borrower must show community support evidenced by local contributing effort. The  borrower must also invest a minimum of 10 percent of the project cost and must supply requested financial information to show that there is a reasonable assurance that the loan will be repaid.

Rehabilitation/Construction Standards
Plans must meet all code requirements. Main Street Iowa will review all building plans and specifications.

Origination Fee
The origination fee is 1 percent at closing.

The terms and conditions detailed above are a broad outline of the Main Street Revitalization Loan Program and are not all-inclusive. IFA, with guidance from Main Street Iowa, will determine the eligible projects, credit worthiness, collateral and repayment terms. Terms and conditions are subject to change.

More Information
Visit the Main Street Iowa web site.