Small business loan guarantee program in California is available to provide support to small businesses that have difficulties in accessing capital in the state. We have lenders in the U.S that provide small business loan guarantee programs that help small businesses to progress in their activities by providing them with funds to it possible.
The idea behind the small business loan guarantee program is to help entrepreneurs business ideas a reality and also assist small business grow. With such initiative, entrepreneurs can build upon their business ideas, self-employed and small businesses get access to capital to grow their business and most importantly reduces unemployment.
Small business loan guarantee program is available in California, providing several small and micro business with capital every year.
How small business loan guarantee program in California works
Small business loan guarantee program is here to help small businesses grow and prosper. Processing of this loan is done by one of seven Financial Development Corporation (FDC) partners throughout California. They help give technical advises as well as process loan guarantees for qualifying small businesses.
This means that certified banks work with FDC in processing small business loan guarantee program. The capital received from this program must be used for any of the following; start-up expenses, construction, inventory, working capital, business expansion, agriculture, lines of credit and others.
The Finance Development Corporation will issue the loan guarantee up to 80% of the loan. The maximum amount each borrower can get is $2,500,000 for a maturity period of 7 years.
How small businesses are determined
When a business have between 1-750 employees, it’s regarded as a small business as long as its entity includes a sole proprietor, partnership, cooperative, limited liability company, non-profit organization, etc.
How to qualify for small business loan guarantee program in California
- Provide a proof of residency, be a resident of California.
- Your small business should have between 1-750 employees.
- You must also be;
- Eligibility nonprofits
- Sole Proprietors
- Limited Liability Company
- Cooperative, etc.
California small business loan guarantee program have been able to create and retain over 412,000 jobs due to their support to small business. This program has the following terms;
Qualifications : The Capital from the program must be used for small businesses within California. Borrowers must also be able to show their repayment ability.
Maximum Guarantee Amount: $2,500,000 for each borrower every year.
Interest Rate: Market rates are negotiable by both the lender and borrower.
Collateral: Your collateral can be your business of personal assists in the form of machinery, equipment, inventory, property)
Fees: Up to 2.5% of the guaranteed part of the loan and $250 documentation fee.