Getting a loan to Start
your Business – What do
you need? What does a
lender look for?
Small Business Lending
and Support Program
Ø Community Capital New York is the leading not-for-profit
small business lender in the Hudson Valley.
Ø Our lending process is timely, personalized and intended to
help those small businesses that need financing to launch or grow their business – but cannot meet the credit and/or
collateral requirements of Banks.
Ø Our rates are low, we accept a broad range of credit scores
(600 +) and alternative forms of collateral.
Ø Our lending decisions are made locally by our loan
Ø CCNY lends $1,000-$50,000 to start-ups and existing
businesses that banks are unable to consider
Ø Loans may be used for equipment, inventory, marketing,
working capital, permits, licenses, energy savings upgrades and business acquisition
Ø CCNY provides term loans with a maximum repayment period of
6 years
Ø CCNY borrows money to loan to YOU – so we have to get paid
Business Sectors Funded
2003 - 2013
General Requirements
Ø
Applicants need a Business Plan
Ø
Must be the principal and effective owner of the
business
Ø
Must be 21 years of age
Ø
Own a business in Westchester, Rockland, Orange,
Dutchess, Putnam, or Ulster counties
What Do We Look For?
Ø
Creditworthiness
Ø
Business Viability
Credit History
Minimum Requirements:
Ø
FICO 600 or higher
Ø
All payments in the past six months must have
been made on time, every month
Ø
No more than $1,000 in collections, charge offs, tax
liens or judgments
Creditworthiness
Ø Obtain one free credit report from each of the 3 credit
agencies once every twelve months at:
www.annualcreditreport.com
Ø Buy your FICO score at: www.myfico.com
Ø Watch out for the VANTAGE score
Loan Application
Ø
We provide a list of required documents. The list includes:
Ø Business Plan
Ø Detailed Loan Budget
Ø Cashflow Projections
Ø Two years business tax returns (where applicable)
Ø Interim financial statements (where applicable)
Ø Two years personal tax returns for all principals who have 20%
or more ownership share and any co-signers. Ø Bank statements: business and personal
Ø Recent proof of income
Loan Application timing
Ø
Loan requests are on a monthly time table:
Ø Loan application packages are received in the beginning of the
month
Ø Staff underwrites the loan request and does a site visit with the
applicants
Ø If basic criteria are met, applicants meet with the loan
committee who makes the final decision on the loan request at the end of the month
Ø
Closing can take place about 5 – 10 business days
Business Viability
Ø Strong business plan:
Ø Does your plan demonstrate an opportunity to succeed?
Ø Does it show that you have carefully researched your market, the
competition, costs and prices?
Ø Do your projections make sense given the type of business and
location?
Ø Location, Location, Location: Does the location fit with the type of
business and the business target market?
Business Viability and the
Business Owner
Ø Industry experience and product knowledge: The number of
years of experience you have in the sector increases your likelihood of success
Ø Drive to succeed: Are you ambitious, enthusiastic, do you work
hard, do you have a vision of where you want your business to go, will you leave ‘no stone unturned’ to solve problems and create
success?
Ø Adaptability: Do you demonstrate the ability to learn from,
understand and deal with new situations in your business and business environment?
Financial Capacity
Will you be able to repay the loan?
CCNY looks at Global Cash Flow:
Ø What is your total household income and expenditure?
Ø What do you spend each month on your existing personal
debt?
Ø What is your existing or projected business income and
expenditure?
Ø What is your existing business debt?
Ø Will your household income and business income combined
Collateral
Value of Collateral not equal to loan size.
Ø “Microloans” are typically under-collateralized
Typical types of Collateral:
Ø Business Equipment – or general UCC financing statement on
the business and its assets; will consider being in second position
Ø Fully owned personal and/or business vehicles
