Government Small Business Loans!

Minority Pre-qualification Loan Program

Up to $250,000!

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Minority Pre-qualification Loan Program

The Minority Pre-qualification Loan Program helps small businesses owned and operated by members of racial or ethnic minorities. This loan program uses local, private sector nonprofit organizations and for-profit businesses as intermediaries to assist in the loan application process.

All of the Federal Government's small business loans are provided to the public on a nondiscriminatory basis.

Minority-Owned Small Businesses:

* Have received 269 loans under the Minority Pre-qualification Loan Program since its inception in April 1995!

* Have obtained $26 million in small business loans, representing an average loan of $98,840, under the Minority Pre-qualification Loan Program!

What Types of Small Businesses Are Eligible For the Minority Pre-qualification Loan Program?

Small Businesses that:

* Are at least 51 percent owned and managed by a racial or ethnic minorities

* Have less then 100 employees

* Have earned less than $2 million in the previous fiscal year

* Are not engaged in speculation or investment in rental real estate.

The maximum loan amount under the Minority Pre-qualification Loan Program is generally limited to $250,000.

The Loan Pre-qualification Process

Loan Documents

The prospective borrower works with an intermediary, designated by the Small Business Administration, to prepare a business plan and complete a pre-qualification loan application.

Use of Loan Funds

Loan funds can be used for typical business purposes such as working capital, debt payment, equipment and inventory purchases, construction, and real estate purchases.

Small Business Loan Qualifications

Primary loan considerations include a willingness and ability to pay debts, as indicated by a good credit history; the likelihood that expected earnings will be sufficient to pay the loan; and the probability that the small business has a good chance of achieving success with the requested loan. 

Normally, business assets will be pledged, and personal assets when warranted. As with all federal government small business loan programs, loans will not be declined where inadequate collateral is the only unfavorable factor. All owners of 20 percent or more of the business are required to personally guarantee the note.

Equity

The loan applicant must have a reasonable stake in the business. 

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