Construction of affordable townhomes with a community planning group reviewing final plans supported by a revolving gap fund.
Cabarrus County, North Carolina, August 28, 2025
Cabarrus County seeded a $2 million Revolving Construction Loan Gap Fund to help nonprofits and social ventures finish affordable and workforce housing projects. Managed by a local housing nonprofit, the fund offers short-term, low-interest loans (1%–3%) to cover final construction gaps so projects can proceed. A Permanent Housing Committee of nonprofit leaders, developers, community members and lenders will review requests with technical support from a local bank. The fund is designed to revolve as loans are repaid and to grow with grants and donations, addressing a significant local housing shortfall amid rapid population and rent growth.
Cabarrus County has provided $2 million in seed money for a new Revolving Construction Loan Gap Fund run by a local housing nonprofit. The fund will make short-term, low-interest loans of last-resort capital to nonprofits and community groups that need the final dollars to begin or finish building affordable and workforce housing.
The fund is structured as a revolving loan fund, meaning repayments are intended to replenish the pool so it can be used again. Loans are designed to be short term and carry low fixed interest rates in the 1% to 3% range. That compares with typical construction loan gap rates that range roughly from 5% to 8%, making this fund a lower-cost bridge for projects close to completion.
The money will not cover full project costs but is intended to provide the critical last dollars that allow construction to proceed. Applications will be taken through the nonprofit managing the program. Loan approval will not rest solely with a bank. Instead, decisions will be made by a local Permanent Housing Committee made up of nonprofits, housing developers, community members and lenders. A local bank will provide technical support to the committee.
Cabarrus County and its largest city have experienced rapid population growth in recent years, increasing demand for homes and rentals. A regional analysis projects the county will be among the top counties for population growth between 2024 and 2029, and estimates show a housing supply gap of more than 15,300 homes for sale and rent combined. Shortfalls are concentrated for households earning up to 80% of area median income, with thousands of rental and for-sale units needed for families at that income bracket.
Local rent averages exceed $1,500 and the county has seen some of the highest year-over-year rental increases in the state. Roughly 27% of the county’s counted housing is considered cost-burdened, meaning those households pay more than 30% of income for housing. Rising land and construction costs are cited as major factors limiting the ability of nonprofits to deliver more affordable housing, which is the gap this fund aims to help close.
The nonprofit managing the fund has several active projects that reflect the type of development the loan fund seeks to support. Recent and ongoing work includes a 26-unit townhome project offering for-sale and lease-to-own options, a conversion of a historic church into a mixed-income development with community and artist spaces, and a tiny home village in a downtown area. Another community group is developing a multi-phase campus on about 10 acres that will provide transitional housing, program space, retail and job supports across three phases, ultimately offering nearly 100 apartments and services for residents working toward self-sufficiency.
The funding mechanism is administered by the housing nonprofit, with technical banking support for underwriting and processes. The approval body includes a range of local stakeholders, which is intended to give smaller groups a better chance to access funding when traditional banks might be hesitant. The expectation is that the initial seed will be supplemented over time by repayments, additional government grants, private contributions and philanthropic donations, allowing the fund to grow and serve more projects.
Funding is aimed at projects that are shovel-ready but need a short bridge to construction. Community groups seeking help can apply through the nonprofit managing the fund. The goal is to move projects into construction faster and increase the local supply of affordable and workforce housing.
The county is home to nearly 245,000 residents, with the largest city containing more than 112,300 people and showing strong growth over the past decade. Population growth and job gains have pushed housing demand higher, widening the supply gap for lower- and moderate-income households. Local budgets and policy steps have also begun to set aside money for affordable housing, but stakeholders say new financing tools are still needed to meet current demand.
A: Nonprofits, social ventures and community development groups working on affordable or workforce housing projects in the county can apply.
A: The fund provides short-term gap financing to cover the final costs needed to start or complete construction. It is not intended to fund entire projects.
A: Loans carry fixed low interest rates generally between 1% and 3% and are structured as short-term bridge loans with repayment designed to replenish the fund.
A: A Permanent Housing Committee made up of nonprofits, housing developers, community representatives and lenders reviews and approves loans. A local bank provides technical support to the committee.
A: The fund is intended to revolve. Loan repayments return to the pool. Additional growth could come from government grants, private donations and other contributions.
A: Applications are handled through the nonprofit that operates the fund. Interested groups should contact that nonprofit for application details and eligibility information.
| Feature | Details |
|---|---|
| Fund name | Revolving Construction Loan Gap Fund |
| Seed funding | $2,000,000 provided by the county |
| Managed by | Local housing nonprofit |
| Loan type | Short-term, gap financing for construction |
| Interest rates | 1% to 3% fixed |
| Typical market comparison | Typical gap rates roughly 5% to 8% |
| Approval body | Permanent Housing Committee made up of nonprofits, developers, community members and lenders |
| Bank support | Technical assistance provided by a local bank |
| Purpose | Provide the final dollars to allow affordable and workforce housing projects to proceed to construction |
| How to apply | Apply through the nonprofit that operates the fund |
| Local context | County population near 245,000; city population over 112,300; regional housing gap > 15,300 homes |
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