EDA RLF | Southern Georgia Regional Commission

Lending | EDA RLF

The purpose of the EDA Revolving Loan Fund is to finance small businesses in the eighteen-county region served by the Southern Georgia Regional Commission (SGRC) in order to create or retain jobs in the region. The RLF is also used to finance business facilities that cannot otherwise receive credit from a private lending institution.

About The EDA RLF Program

Use of Proceeds:

• Land and building acquisition
•Machinery and equipment
•Working capital
•Construction
•Renovation of existing structure
•Professional fees

Loan Amount

Up to 50% of the eligible project cost not to exceed the maximum amount of funds is $500,000 per borrower.

Type of Business

Eligible businesses include for-profit businesses (individual proprietorships, partnerships, or corporations). The industrial development authorities of the SGRC's service area can borrow RLF funds if the funds are used to acquire fixed assets for an industry committed to locate in the region.Ineligible businesses include: non-profit businesses, passive income or developer/landlord deals, lending and investment institutions, media (newspapers, magazines, etc.), medical facilities, farming and agricultural projects.

The EDA RLF Loan Program Procedure...

Approval , Closing, and Servicing:

The loan application is prepared by the SGRC staff and is submitted to the SGRC Loan Board for approval. After the RLF funds have been approved, the SGRC will close the loan in conjunction with the private lender. Loan servicing is generally done by the SGRC.

The EDA RLF Loan Program Features...

Benefits:

•SGRC prepares the majority of the paperwork for the business
•Businesses obtain loans which are not otherwise available
•lower interest rates

Interest Rate:

Interest rate on the SGRC's portion of the loan is generally at or below market rate. Interest is charged only on the unpaid balance of the principal and for the actual time used. The bank sets the rate of interest on their portion of the loan. The rate on the SGRC portion may be fixed or variable.

Repayment Schedule:

•Real estate - up to a 20 year term
•Machinery and equipment - up to a 10 year term
•Working Capital - up to a 5 year term

EDA RLF Loan Program Requirements...

Cash Flow:

Borrower’s adjusted cash flow must be adequate to service the entire debt.

Credit History:

Borrower must have satisfactory history of meeting debt obligations in a timely manner.

Management:

Borrower must demonstrate to the SGRC that it has experienced and adequate management to operate the company successfully.

Location:

The project must be located within the eighteen Southern Georgia counties of Atkinson, Bacon, Ben Hill, Berrien, Brantley, Brooks, Charlton, Clinch, Coffee, Cook, Echols, Irwin, Lanier, Lowndes, Pierce, Tift, Turner, or Ware.

Collateral and Participation Position:

The SGRC generally shares the collateral on a pro-rata basis with the private lender. The private lender must be willing to participate with the SGRC for up to 50% of the loan amount.