For fixed assets and permanent working capital, WHEDA may provide a guarantee of up to the lesser of 75% of the loan or $750,000.
Examples:
Principal Amount |
Maximum Guarantee % |
Guarantee Amount |
$ 500,000 |
75% |
$375,000 |
$1,000,000 |
75% |
$750,000 |
$2,000,000 |
37.5% |
$750,000 |
$5,000,000 |
15% |
$750,000 |
For revolving working capital loans, WHEDA may provide a Guarantee of up to the lesser of 75% or $200,000.
Examples:
Principal Amount |
Maximum Guarantee % |
Guarantee Amount |
$250,000 |
75% |
$187,500 |
$350,000 |
~57% |
$200,000 |
$500,000 |
40% |
$200,000 |
For variable rates, the rate charged to the Borrower may not exceed Prime + 2 3/4%. Use the lowest Prime lending rate as quoted in the Midwest Edition of The Wall Street Journal as the interest rate index. A comparable index rate will be considered on a case-by-case basis.
For fixed rates, use your standard rate, which will be subject to approval by WHEDA.
The term of the guarantee is up to 5 years for fixed assets, inventory and permanent working capital, and up to 2 years for revolving working capital loans. Revolving working capital loans must annually rest for 30 consecutive days.
When the guarantee is used to refinance an existing Note or credit card debt, the term of the guarantee may not exceed the remaining useful life of the assets securing the Note.
The amortization cannot exceed the useful life of the security, however it can exceed the term of the Neighborhood Business Revitalization Guarantee.
The Lender must obtain a security interest in the physical plant, equipment, machinery, or other assets of the business and/or development. Personal guarantees may be required.
Lender is required to retain all documentation considered necessary and appropriate for the loan. This may include, but may not be limited to: environmental reports, surveys, borrowing resolutions and plans and specifications.
WHEDA reserves the right to require additional terms and conditions that may include, but may not be limited to: limitations on owner draws, salary, capital expenditures, dividends, etc.
