|
|
|
Bucks for Small Biz
|
Business New Haven
10/29/2001
By: Anne-Marie Brungard
|
So what happens to small businesses that are just not traditionally bankable? Where do you go for financing when you don't have any collateral, if past credit problems continue to plague you, or the size of your loan is just too small for banks to consider?
The Community Economic Development Fund (CEDF) may have some answers. Much like a bank, the CEDF processes loan packages. Unlike most banks, however, CEDF specializes in working with small and minority-owned companies that need additional support services.
Preston Maynard, the CEDF's vice president and community development officer, understands the special needs of small businesses and the communities that support them. Armed with prior experience in real-estate planning, historic preservation and finance, Maynard hopes to encourage the growth of small business by supporting community development efforts. According to Maynard, “For small businesses to be successful, they need the community to create a stable environment [in which] to do business.”
In addition to its community-development efforts, CEDF offers micro-loan programs and technical assistance for small businesses. Some business owners need help developing business plans, marketing plans or financial statements. CEDF collaborates with community providers such as the Greater New Haven Business & Professional Association or the state's Small Business Development Centers to prepare business owners for the financing process.
Once the loan is written, recipients must agree to participate in a continuing technical-assistance program that may address legal or tax issues, as well as on-site consulting. Technical-assistance staff have assisted with analyzing pricing, marketing strategies and even helped one woman going through a divorce to transition her business without the need to file bankruptcy.
“Many [small businesses] need an infusion of capital as well as management to help grow their business to the next level,” explains CEDF President Donna Wertenbach. “CEDF provides expert business assistance to help business owners develop management skills.”
CEDF provides services in 51 eligible communities including Hamden, Bridgeport, New Haven, West Haven, Meriden and Waterbury. Specialized loan programs include:
• Grow-Your-Business Loan Program: New initiative offers low-interest loans for stable businesses that are expanding but have difficulty obtaining traditional bank financing. Applicant company must have been operational for minimum of three years and be headquartered in eligible municipality. Maximum loan size is $50,000, with the interest rate set at one percent above prime. That means that your loan could be available today at as low as six percent. This loan program offers a streamlined application process that includes a simplified application and a one-page marketing/management statement rather than the usual detailed business plan. In addition, quick turnaround times are considered a hallmark of the program.
• Women and Minorities Program: Collaborative effort with state's Department of Community and Economic Development, this program can support loans up to $50,000. For existing businesses the loan can be used for acquisition of equipment, inventory or working capital. A non-traditional approach is utilized to look at the business owners' credit and collateral.
• U.S. Small Business Administration (SBA) Micro Loan Program: Special financing for small businesses facing difficulties obtaining financing from traditional financial institutions. Loan can be used to finance a new business or help to grow an existing business, for working capital, inventory or machinery or equipment. Fixed-rate term loans (maximum $35,000) permit flexible conditions to meet business needs. The simplified application process includes submittal of a condensed business plan with financials.
CEDF works closely with a number of area banks and can present loan packages up to $250,000, with an average loan size of about $75,000. Joining forces with the state, leading lenders and representatives from low- and middle- income communities, CEDF is bringing help for Connecticut's small businesses.
|
Go FirstGo PreviousGo
NextGo LastGo
to Index
|
|
