BUSINESSLINC COMMUNITY LOAN FUND

BusinessLINC Community Loan Fund

3355 Lenox Road
Suite 750

AtlantaGeorgia 30326
(770) 944-3198
jerry@georgiabusinesslinc.org

New Market Tax Credits Program

The NMTC Program, established by Congress in December 2000, permits individual and corporate taxpayers to receive a credit against federal income taxes for making qualified equity investment in investment vehicles known as Community Development Entities (CDE). The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year period. Substantially all of the taxpayer’s investment must in turn be used by the CDE to make qualified investments in low-income communities.

New Market Tax Credit Business Loan – Equipment 

What is the New Market Tax Credit Business Loan Equipment Program?

New Market Tax Credit Business Loan-Equipment offers qualify borrowers yet another business financing option that may be the best financial choice. Eligible borrowers can obtain loans with lower interest rates and term up to 7 years, creating a lower monthly payment and allowing borrowers to keep more cash in their businesses.

The New Market Tax program helps revitalize targeted urban and rural geographic areas through the retention and creation of jobs, the renovation and expansion of vacant business properties, community facilities, and the purchase of major equipment for business expansion.

What is the New Market Tax Credit Business Loan Guideline?

USE OF FUNDS:  Term financing for businesses (including non-profit businesses) seeking to purchase major equipment for their businesses.

BCLF Loan Size:  Minimum:  major equipment with a minimum useful life of 5 years, minimum vale of $50,000 per item

  Maximum:  $1,000,000

  Advance Rate:  50% for use equipment; 80% for new equipment.

Loan Interest Rate:  Interest rates are fixed for the loan term and will generally be up to 3% below market. Actual loan rate to the borrower will typically be set two days prior to loan closing.

Loan Term:  7-year amortization and term.

  If useful life is less than 5 years, loan will amortize within useful life.

Minimum Down Payment:  10% for loans less than $500,000. Loan over $500,000 require 15% equity or provide credit enhancement.

Valuation:  Market value of equipment or other personal property valued over $50,000 by requiring the submission of invoices for new equipment, or a recent appraisal conforming to USPAP standards 7 and 8 for used equipment.

Owner-Occupancy:  Operating Company must occupy at least 51% of the real estate financed.

Borrower Requirements:  Management Expertise – History of present management team. BCLF requires at least two years management experience with company or management experience in the same industry of at least five years.

Additional Requirements:  Borrower must qualify as a Qualified Active Low-Income Community Business (QALICB): at least 50% of employees and at least 50% of tangible property owned and leased by the business must be located in qualifying low-income census tract(s)

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New Market Tax Credit Business Loan-Real Estate

What is the New Market Tax Credit Business Loan Real Estate Program?

New Market Tax Credit Business Loan-Real Estate offers qualify borrowers yet another business financing option that may be the best financial choice. Eligible borrowers can obtain loans with lower interest rates and term up to 25 years, creating a lower monthly payment and allowing borrowers to keep more cash in their businesses. The New Market loan enables borrowers to expand and renovate their existing properties, buy the properties outright, or purchase additional property for business expansion.

The New Market Tax program helps revitalize targeted urban and rural geographic areas through the retention and creation of jobs, the renovation and expansion of vacant business properties, community facilities, and the purchase of major equipment for business expansion.

What is the New Market Tax Credit Business Loan Guideline?

USE OF FUNDS:  Takeout or permanent financing for businesses (including non-profit businesses) seeking to purchase, construct (new or expansion), or rehabilitate buildings occupied by their businesses.

BCLF Loan Size:  Minimum:  $50,000

  Maximum:  $2,500,000

Loan Interest Rate:  Interest rates are fixed for the loan term and will generally be up to 3% below market. Actual loan rate to the borrower will typically be set two days prior to loan closing.

Loan Term:  25-year amortization and term.

Minimum Down Payment:  10% for loans less than $500,000. Loan over $500,000 require 15% equity or provide credit enhancement.

Valuation:  Current appraisal required for financing packages in excess of $250,000. Appraisal or alternative valuation method (approved by BCLF) required for loans less than $250,000.

Owner-Occupancy:  Operating Company must occupy at least 51% of the real estate financed.

Borrower Requirements:  Management Expertise – History of present management team. BCLF requires at least two years management experience with company or management experience in the same industry of at least five years.

Additional Requirements:  Borrower must qualify as a Qualified Active Low-Income Community Business (QALICB): at least 50% of employees and at least 50% of tangible property owned and leased by the business must be located in qualifying low-income census tract(s)