“Promoting Social and Economic Self-Sufficiency” Financial Assistance WORC offers five loan products for the low-income borrower: Direct Loans of up to $500 to $2,500 Credit Lines of up to $2,500 Small Business Loans of up to $10,000 (for existing businesses only) Bank Guarantee Loan up to $10,000 ($5,000 for start-up businesses) - 30% guarantee offered by WORC - direct referral to banks and other loan funds "New Product" Near Equity Loan Product - up to $25,000 In addition, WORC is certified as a SBA Pre-qualification and Low Doc Agency packaging loans up to $250,000. Prequalification loans are limited to Minorities, Women, Veterans, and Disabled. Process results in a Pre-Approval letter from the SBA if approved. The applicant must pay a $500.00 loan-packaging fee to WORC under contact. WORC will complete the loan packaging and work with the applicant to present to area banks for funding. Additional fees apply when a bank for funding approves the business. Product Features: Application fees and closing fees apply Direct Loan, Credit Line, Small Business Loan and Bank Guarantee Loan - Application Fee $25.00, Closing Fee $25.00 Near Equity Loan Product - Application Fee $400.00, 1% Commitment Fee Interest Rate Direct Loan, Credit Line, Small Business Loan and Bank Guarantee Loan 12% Near Equity Loan Product - 6% -7% and up to 1% of gross sales Loan Term Direct Loan, Credit Line, Small Business Loan and Bank Guarantee Loan - up to two years Near Equity Loan Product - Five to seven years Borrower Requirements: Must be Low income - Low income is defined as having a household income of not more than 80% of Median income as defined by HUD Collateral is not required For most products - credit need not be perfect but must be either in repair or repairable (must have means to put a credit repair plan into action) Good credit is required for the Credit Line and for the Near Equity Loan Product Savings Plan is required if credit problems exist - FSA Programs/Credit Repair Class Available Application Process: Business Plan is required Three years tax returns on borrower/business if existing business Two letters of recommendation (1 personal/ 1 business) Business License All payments made Automatic Clearinghouse (ACH) Near Equity Product Description Debt with participation designed for high growth businesses Uses Addresses the financing needs of high growth businesses: working capital; real estate purchases, equipment purchases, business expansion Loan Range Up to $25,000 Term Five to seven years Interest Rate 6-7% interest rate and up to 1% of gross sales Repayment Negotiated on a case-by-case basis. Financial covenants will be developed to address contingencies Fees $400.00 loan application fee/ 1% loan commitment fee The product is a debt instrument with the downside protection of debt (collateral is taken as security) and the upside protection of high growth offered by equity-like products. The product will be offered to businesses with a solid management team and anticipated high growth. These may include start-ups with a high demand market niche and experienced management, acquisitions with high growth potential. The funds may be used for purchases of real estate, equipment, inventory, working capital or business acquisitions. Loan Application Process Staff helps business owners to develop, complete or provide essential items needed for the loan package, such as (depending on whether they are new or existing): A complete business plan that includes the owner(s) resume, if available; Historical financial statements (2 years if available); Projected financial statements and cash flow projections (5 yrs preferred, minimal 3); A description of the businesses financing need as well as the source and use of funds; Information regarding the credit background of the applicant; Description of collateral; Information regarding the proposed loan structure; Accounts receivable and payable aging scheduled and a breakdown of inventory composition where appropriate; Personal financial statements from all company owners; and Personal and business tax returns (2 years).