NMTC equity can provide 20-25% of equity, like gap financing to a project or business.
Most NMTC-funded businesses and projects receive financing that involves more favorable terms and conditions than those the market typically offers and may include some of the following:
- Below market interest rates
- A longer than standard period of interest only loan payments
- Higher than standard loan to value ratio
- A longer than standard amortization period
- More flexible borrower credit standards
- Nontraditional forms of collateral
- Lower than standard debt service coverage ratio
- Subordination