McLean County Micro-Lending Program
The McLean County Small Business Micro-Lending Program is established to provide a source of financing, which may not otherwise be available within the county, for expanding or start-up businesses. Used to fill a "financing gap" in a business development project, the micro-loan offers a low-interest option to complete a financing package. A “gap” occurs when the business lacks the funds to meet the equity requirements of bank financing or needs a lower interest rate.
Further, this program seeks to:
- Retain and attract businesses that provide permanent jobs
- Maximize investment within the County
- Promote sales and tax generating projects
- Provide financial assistance to eligible businesses
It is the intent of the micro-lending program to view both existing and start-up businesses as equal under the criteria, with preference given to expansions and start-ups resulting in retained or new jobs and/or new sources of economic activity within McLean County.
McLean County Small Business Micro-Lending
|Start-up businesses||up to $25,000 available|
|Established businesses||up to $50,000 available|
|Credit builder loans||from $500 to $3,500
with 6 to 72-month terms
|Interest Rate||Variable, generally 150 basis points
|Term||7 – 15 years (based on project)|
|Fees||Borrowers must pay one-time 10 percent closing fee if approved; no application fee assessed|
|Collateral||Required, Flexible (based on project)|
|Time for Process||45-60 days after approval|
Micro-Lending Program -- Frequently Asked Questions
Who is eligible for this program?
Although the program is not primarily driven by credit scores, an applicant‘s score will determine the maximum amount of the considered loan. The interest rate is individually determined by the McLean County Board. McLean County provides loans at a rate 1.5 percent (150 basis points) below market as determined by the County. Factors include type of business, term of loan, credit score, and any specific case impacts determined.
Are there any restrictions on the loan?
The loan proceeds must be used for business purposes only, including equipment purchases, inventory, leasehold improvements, working capital, purchase of an existing business, or other basic business needs.
Why do I need a business plan?
McLean County will require a business plan if the operation has been open for less than six months. The business plan does not have to be lengthy but should include a marketing strategy and 12 months worth of cash flow projections, detailed by month.
Is there an application fee?
McLean County does not charge an application fee. However, if the request is approved, the County will charge a one-time closing fee of 10 percent. Commitment fees may be added to the loan - requiring minimum out-of-pocket expense at the time of closing.
Is any collateral required?
Collateral is required for most loans; however, the program allows for flexible options. McLean County may also require a cosigner in some cases.
Do borrowers have to pay the money back?
Yes. Micro-loans are just like any other loan – borrowers must repay the principal and interest. This is not a grant program.
How can I apply for a micro-loan?
Prospective borrowers should contact the Small Business Development Center at Illinois Wesleyan University. Generally, applicants can begin the application process only after they have discussed micro-loan participation with the SBDC. The first step is to arrange a meeting with a staff person at SBDC.