FAQ

LOAN PROGRAM

The County Development Loan Program (CDLP) provides financing for existing nonprofit organizations and businesses for expansion and development.

How May I use Funds?
Loan proceeds may be used for property acquisition, equipment/machinery purchases, tenant improvements and working capital.

How Much Can I Borrow?
Loan amounts range from $100,000 to $1,000,000. Applicants may be required to inject 10% of the total project cost.

Who is Eligible?
Loan assistance is available to nonprofit organizations and businesses located in the Los Angeles County Urban County, which includes all unincorporated communities and participating cities.

Firms and principals must demonstrate good credit and show evidence of repayment ability.

The loan purpose must satisfy HUD Community Development Block Grant requirements, which include job creation or retention, elimination of slum/blight and increasing the availability of goods and services to low- and moderate-income residents.

What is the Current interest Rate?
Rate currently set at 1% above prime.

What is the Loan Fee?
The loan fee is 2 points, and may be paid from proceeds. In addition, the borrower will pay the costs associated with closing the transaction. These costs may include the preparation and filing of Uniform Commercial Code (UCC) documentation and/or Trust Deeds.

What are the Loan Terms?
The term for repayment will generally be based on the useful life of the assets being financed. Typically, working capital may be financed for 5-7 years, equipment/machinery for 7-10 years, and real estate for 15-20 years.

Is Collateral Required?
Collateral is required. The applicant must be willing to pledge collateral owned by the business or its principals. The CDLP will take a security interest in available assets and personal guarantees of all individuals with a substantial interest, defined as 10% ownership or more.