EDFC MICROENTREPRENEUR LOAN PROGRAM

The Economic Development and Financing Corporation has been selected to administer the Rural Microentrepreneur Assistance Program throughout Lake and Mendocino Counties This program provides access to capital in order to boost small business development, create jobs and strengthen rural communities.

EDFC is partnering with West Company and Resource For Native Development to offer technical assistance to clients who participate in the RMAP Loan Program. Technical assistance is designed to help the microentrepreneurs to obtain additional tools needed to operate their businesses successfully.

ELIGIBILITY
• For profit, privately owned, established small businesses located in Lake and Mendocino Counties.
• Must have 10 or fewer employees.
• Start up or growing businesses which may not meet regular bank lending criteria, but which have a track record in business and/or paying their bills on time and which have reasonable prospects of being able to repay a loan.
• Have sufficient monthly income to pay back the loan.
• If business owner is behind in payments, child support payments, or in default on any loans including government and student loans this could make the owner ineligible.

LOAN AMOUNT
• Maximum of $50,000.
• A 25% non-federal funding match is required.

INTEREST RATE/FEES
1. Fixed rate of interest ranging from 7.5% – 9.5% depending on credit score and collateral.
2. $200 fee for all loans up to $10,000. 2.5% origination fee for loans from $10,001 to $50,000. Maximum fee will be $1,125 plus closing costs.

REPAYMENT TERMS
• 10 year maximum terms.
• Interest only payment period possible.
• No prepayment penalty.

COLLATERAL
• First lien on collateral is preferred.
• Subordinate lien on real estate is possible.
• Personal guarantees of the owner(s) (20% or greater) of the business are required.
• Insufficient collateral may trigger enrollment into the California Capital Access Program (CalCAP) collateral support.

USE OF FUNDS
• Working capital
• Inventory
• Equipment financing
• Any legitimate business need except construction.

TECHNICAL ASSISTANCE AND TRAINING
Required and available at no or minimal charge through the term of the loan.
Includes accounting, marketing, basic business management, and employee concerns.