The LDC is committed to serving new and existing businesses and industries, and to assist with the creation and retention of quality jobs through direct and collaborative funding of projects for the economic well being of Franklin County.
LDC Revolving Loan Fund:
The LDC was established in 1989 to help businesses that needed financing, but were not in the market for bonds issued by the IDA.
As an economic development fund, the LDC helps businesses create and retain jobs, and will provide loans for real estate, equipment and machinery, inventory and working capital.
How much can I borrow with an LDC loan?
The LDC provides "Gap" financing of up to 40% of total project cost with a cap of $250,000.
What is the lending rate and what is it based on?
The interest rate on all loans is fixed at the time of loan approval at not less than five percent (5%), and is based on the Prime Rate as published in the Wall Street Journal plus two percent (2%).
You can find the current Prime Rate here: http://www.bankrate.com/rates/interest-rates/wall-street-prime-rate.aspx
How long do I have to repay an LDC loan?
Repayment can be as long as ten (10) years with real estate as collateral, and up to seven (7) years with machinery and equipment as collateral. Working capital loans will be extended for up to five (5) years.
How long does it take to process a loan?
It can take several weeks to obtain all the information we need, including credit and financial reports, tax returns and other documents required with your application. When the initial review is complete, your loan will be acted upon by the LDC's board of directors. From application to approval to closing can take as long as 90 days.
What can you do to help me start a new business?
The first steps are to have a plan in place, and some money of your own to put into it. Lenders look for equity you are putting into the business, as well as adequate collateral. Plus, you'll want to make sure there is enough money in the bank (capital) to get your business established and carry you through the lean months.
You will need a Business Plan with financial projections for your primary lender as well as the LDC. This is something you may be able to do yourself using SBA guidelines, you can hire someone to do it, or you can contact your local Small Business Development Center (SBDC). We work with the SBDC at SUNY Plattsburgh and at SUNY Canton, and their services are funded by SBA, so they are provided at no cost to you.
We are here to talk to you at any stage of your business startup or expansion.
Which institution should I contact as a primary lender for my
It makes sense to start with the institution where you have an established relationship, such as a checking account, and branch out from there. Depending on the size and scope of your project, primary funding can come from a bank or credit union, a venture capital firm or other investors, family members or your own equity. It is also common for more than one "gap" financer to jointly fund a project.
Do I have to personally guarantee the loan?
Yes, if you or others own twenty percent (20%) or more of the business project, you will need to personally guarantee the loan. This may include a pledge of personal assets as collateral, such as property, but the LDC typically takes a subordinate position to a primary lender.
What else do I need to consider in applying for a loan?
Make sure that your application is complete to shorten processing time, and keep in mind that the LDC has economic development objectives. Your investment and ability to create or retain jobs will be considered along with the feasibility of the project. This is where your Business Plan with financial projections can help us understand how you think this will work.