Affordable Housing Corporation can help you start a small business
- Loan funds available
The purpose of the program is to help small businesses acquire funding needed to start or grow their business in Affordable Housing Corporation's target area. Business loans may provide terms that are more lenient, less secure, or otherwise less stringent than industry standards. The primary goals of the program are two-fold: job creation/retention; and development/redevelopment of under-utilized/deteriorated commercial/industrial property in the target area.
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Who is eligible for a business loan through Affordable Housing Corporation?
Can I get a loan to help with my business?
What is the maximum amount I can borrow?
Do I have to pay back the loan? What are the terms of the loan?
Are there any restrictions on how I use the business loan funds?
What are some of the reasons I would be denied a business loan?
My credit is bad. Can I get a business loan?
Do I have to start or expand my business in Grant County?
How do I learn more about business loans or apply for a loan?
Who is eligible for a business loan through Affordable Housing Corporation?
To be eligible for a business loan, you must meet all of the following requirements:
- Enterprise must be geographically located in the agency's target area(s)
- Enterprise must be current with city, state and federal financial obligations
- Your business employs fewer than fifty employees at the time of application
- New equity and private financing must be maximized and fully committed
- Evidence that the business loan is necessary for the enterprise to succeed
- Demonstrate ability to repay the business loan and adequate collateral/garantees for securing the loan
- The applicant must provide the following: completed application form, including available collateral and 2 references; credit report release; $250 application fee; completed business plan; projected income and expenses; projected cash flow; tax returns for the last 3 years; resumes of borrower and other key personnel; and proof of business insurance
Can I get a loan to help with my business?
Yes.
What is the maximum amount I can borrow?
Business loan funds should account for less than 30% of the total project costs (gap financing) whenever possible; the loan may fund up to 100% of the project costs or can be used in conjunction with other lenders.
Do I have to pay back the loan? What are the terms of the loan?
A business loan is not a gift or a grant. It is a loan that must be repaid, with interest, following a specified payment schedule. A typical pay back plan would be monthly payments at a below market interest rate over one to ten years. Borrower may prepay at any time with no pre-payment penalty. There is a 1.25% commitment fee due once the loan is approved. The commitment fee can be deducted from the loan proceeds.
Are there any restrictions on how I use business loan funds?
Business loans may be used for:
- Real estate acquisition
- New construction
- Rehabilitation
- Equipment purchases
- Working capital
- Or for any other expense deemed reasonable
What are some of the reasons I would be denied a business loan?
You will not be denied a business loan because of your race, color, national origin, religion, age, gender, familial status, disability or status as a veteran.
Reasons for loan denial may include:
- Unresolved credit issues
- Not enough money to repay the loan
- Issues related to your business plan
- Total debt of borrower (your monthly debt payments, including payments on a business loan, cannot exceed 41% of your monthly household gross income)
My credit is bad. Can I get a business loan?
There are some credit requirements that banks and AHC require of loan applicants that are related to the borrower’s ability to repay the debt in a timely manner. Your credit situation will be evaluated on an individual basis. Delinquencies or past due balances on debt payments can negatively impact your ability to receive a loan. An AHC counselor will meet with you individually to review your credit situation prior to making loan application. If applicable, this one-on-one meeting will assist you in developing a plan to clean up your credit issues.
Do I have to start or expand my business in Grant County?
Yes. Your business must be located in the area served by AHC.
How do I learn more about business loans or apply for a loan?
Contact AHC at 765-662-1574 ext. 100.
