For more information, download our loan sheet:

Predevelopment loan

Case Study

AAFE | Hardesty Renaissance

NC’s provided a $500,000 predevelopment loan to help AAFE fund part of the early costs of creating a new community on a former Army supply depot, with educational and commercial developments, and hundreds of new apartments.

NeighborWorks Capital was there for us when we made the strategic decision to enter a new market and develop a major project that will be transformative for Kansas City. The acquisition and predevelopment financing they provided was critical to this project and we value their partnership. ~ Ernesto Vigoreaux, Chief Development Officer, Asian Americans for Equality

NC’s Predevelopment Loan product is aimed at providing NWOs with critical and flexible funds needed to conduct early stage due diligence. Funds are typically used for environmental studies, market studies, appraisals, architectural and engineering expenses, legal fees, working capital and earnest money deposits. Pre-development loan amounts can be up to $500,000 with a maximum loan term of 36 months. The interest rate is around 5.75% (fixed), with interest only payments. Loans are unsecured and made on a recourse basis to the borrower. This product has been especially beneficial to small and rural NWOs who have limited access to local or organizational resources.




Earliest stage capital for design and engineering, market and environmental studies, appraisals, legal costs, filing and application fees, deposits and working capital 

Loan amount

Up to $500,000 unsecured

Larger loan amounts may be possible with security in real property, assignment of grant proceeds, or other options – please discuss with your loan officer 

Loan term

Up to 36 months

Interest rate

 From 5.75%, dependent on security, term, process to move project to construction or other start point 


None required up to $500,000 

Options with larger loans include liens on real estate, pledges of grant funding or developer fees, assignment of ownership interest, etc. 

NWO’s will provide repayment guaranties for loans made to affiliates 

Repayment source

Typically construction or acquisition financing for development, or could be alternative funding such as grants 


Application Fee - $1,000 Origination Fee - 1.00% to 1.50% of loan amount 

Third-party reports

May include appraisal and environmental assessment for larger, secured loans