Business Owner FAQs

• Application Checklist

  To secure a business loan, CCDC may request the
  following items from applicants:

  • History and description of business
    • – Products and services
    • – Market analysis
    • – Management information and resumes
  • Project description
  • Use of funds and written cost estimates
  • Financial statements from applicant and affiliated businesses
  • Balance sheet, income statement and business tax returns for three years
  • Current year interim business balance sheet and income statements (less than 90 days old)
  • Projected income statements
  • Personal tax returns of 20% owners for last three years
  • Personal financial statements of 20% owners
  • Loan application fees, as applicable
  • Bank commitment letter, if required
  • Appraisals as applicable
  • Environmental questionnaire and formal assessment, if required
  • Lease or purchase agreement
  • Accounts receivable and accounts payable aging report

• What types of small businesses does CCDC work with?

  • An operating, for profit small business demonstrating a need for credit located in the State of Ohio
  • Typically companies with annual sales between $500,000 and $15 million.
  • The maximum number of employees is 500, but most of the small businesses we work with have between 10 and 50 employees.
  • For City of Columbus, City of Grove City and Franklin County loan programs please contact CCDC for information.
  • For information on ineligible business for SBA loans, please contact CCDC.

• Where does the money come from?

  • SBA 504 – CCDC’s financing portion comes from sales of bonds guaranteed by the full faith and credit of the U.S. government
  • Bank portion of financing comes from our long-term Bank Partners
  • City of Columbus and Franklin County loans– funds are made available through Community Development Block Grants

• What about refinancing?

  • Refinancing an SBA 504 loan permitted for certain Projects. Please ask a CCDC loan officer about the details.
  • Refinancing other lender debt will soon be allowed by SBA 504.  Details will soon be released.
  • No Refinancing in the City of Columbus or Franklin County loan programs.

• Can loans be prepaid?

  Yes, but there’s a penalty during the first half of the loan term for SBA 504 loans. Under some circumstances, the loan may be assumed.

  City of Columbus and Franklin County loans can be prepaid without a penalty.

• What’s the typical turnaround time for loan approval?

  • CCDC’s Board of Directors holds weekly meetings, enabling a quick approval internally
  • Upon receipt of a complete loan application, loans submitted to SBA generally take 1-2 weeks for approval.
  • City and County loans are approved within a week of receiving complete loan applications.

• What about collateral?

  • Assets of the financed project are typically used as collateral
  • Personal guarantees of all owners of 20% or greater of the businesses involved will be required to guarantee the loan
  • Corporate guarantees of the operating company (if not the loan Borrower) and/or qualifying affiliates will also be required to guarantee the loan

• What fees are involved?

  • SBA 504 – Fees include $500 Application fee,  2.15% loan fee plus closing costs that may be financed in the loan and 0.5% of first lienholder loan (paid by participating lender)
  • City of Columbus and Franklin County fees are minimal and paid out-of-pocket.

• What is the average minimum and maximum loan amount?

  • SBA 504 Loans typically average between $400,000 and $500,000, and can go up to $5 million.  For manufacturing the maximum loan can be $5.5 million.  The minimum loan size is $50,000.
  • City of Columbus loans range from $50,000 – $100,000 for working capital and inventory and up to $195,000 for real estate and equipment.
  • Franklin County loans range from $50,000 – $250,000 for real estate, equipment, working capital and inventory.
  • Please contact CCDC for additional loan services.

• What are some of the loan programs available?

  • SBA 504 enables healthy, growing companies to purchase land, buildings, machinery and equipment, or fund new construction up to $5 million and up to $5.5 million for manufacturing businesses.
  • City of Columbus offers working capital or real estate funding for smaller businesses.
  • Franklin County Loan Program provides flexible financing for up to $250,000 in working capital,  real estate, equipment and business acquisition.

  For details, refer to Loan Programs.

• What’s an SBA 504 loan?

   

  • A loan funded by the sale of bonds guaranteed by the Federal government to finance the purchase of fixed assets (real estate and large equipment).
  • Long-term, fixed-rate financing for with a term of 10 or 20 years.
  • Second lien position behind Lender, typical structure is 50% Lender, 40% CCDC/SBA, 10% Borrower equity.    Some types of business require larger equity injection by Borrower.  Contact CCDC for more information.

• What does CCDC finance?

  • Real estate for business expansion
  • New buildings, additions or renovations
  • Machinery and equipment
  • Working capital and inventory (in Franklin County and City of Columbus only)