Frequently Asked Questions for Lenders: Eligible Businesses
Other Lender Questions
Eligible Uses of Loan Proceeds
Underwriting
Servicing Responsibilities
What is the definition of an
existing business? 
An existing business is defined as follows:
- A business that has been in operation for at least 12 months;
- A business that ceased operations within the last 6 months, but was
operating for at least 12 months before closing;
- An existing business being acquired by a new owner; or
- An existing business adding a complementary business, i.e. a motel
adding a restaurant.
Existing businesses that are relocating will be considered on a case-by-case
basis based on the reason for the move, distance from the current location,
impact on employment in the current area, etc.
What is the definition of a start-up
business?
A start-up business is one of the following:
- A new business; or
- An existing business with less than 12 months' operating history.
Although most start-ups are not eligible, exceptions to this are new
day care facilities and a new business that will be located in a vacant
storefront in the downtown area of a rural community. A rural community
is defined as "(1) a city, town or village in this state with a population
of 12,000 or less, or (2) a city, town or village in the state that is
located in a county with a population density of 150 persons or less per
square mile."
Are cooperatives and non-profit
organizations eligible?
Yes, as well as sole proprietorships, partnerships and corporations.
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