LOAN INFORMATION

The mission of Colorado Enterprise Fund (CEF) is to provide credit to small businesses that do not have access to loans from commercial sources. Through loans and services, we help entrepreneurs strengthen their businesses, stabilize and increase their incomes, create additional employment and contribute to the economic revitalization of their communities.

ELIGIBILITY

CEF lends to businesses anywhere in the State of Colorado.
Liquor stores, bars and certain other businesses are not eligible. (Real estate development and investment oriented businesses are ineligible)
Loan funds may not be used for owner's salaries, personal expenses, delinquent taxes and certain other purposes.

LOAN TERMS

Loan amounts range from $1,000 to $250,000
Current interest rates range from 9% to 14% per year
Loans may be amortized up to 7 years or longer in some cases
Fees may include the following:
- Loan application fee of $25 per owner or cosigner
- Commitment fee between 1.5% to 5%
- $100 per year technical assistance fee and other fees for document recording, etc.
Any person or entity with over 20% ownership interest in the business must guarantee the loan. CEF may also request a cosigner or additional guarantor in some cases. This may be a person who does not live in the applicant's household and is not a principal member of the business. Cosigners/Guarantors must have good credit and the capacity to make the loan payment.

FACTORS IN LOAN EVALUATION

Loans To Existing Businesses:
- Financial ability to repay
- Commitment and motivation to improve your business
- Good payment history with other creditors, landlords, suppliers, etc.
- Collateral available to secure the loan is valued at liquidation or trade-in prices
Start Up Business Loans - Entrepreneur must have:
- Industry experience and personal equity investment of between 10-20%
- An alternative income source
- A business plan and financial projections (required)
- Start Up businesses are usually limited to a loan of $25,000

Although we are not a bank, we do utilize basic lending guidelines when reviewing a loan application. The difference is that we are more flexible in how we apply these guidelines and we review all aspects of your request in our decision making process. Some of the typical factors we review when evaluating a loan request include:

CREDIT REPORT - while good credit is important, CEF recognizes that applicants may have had credit issues in the past. We attempt to be more flexible than a traditional lender when reviewing your credit report.
COLLATERAL - Collateral is considered a secondary source of repayment if the cash flow of the business is inadequate to repay the loan. Collateral also demonstrates that the owner believes in the business by putting up something of value to ensure payment. We typically require collateral for loans, however the size of the loan and other factors may influence the required amount. Start up businesses and larger loan requests will usually require more collateral coverage.
EQUITY (owner investment) - We want to see that an applicant has something at stake in the business. For a startup this may be in the form of cash or equipment or other assets already owned by the business before the loan. A startup business may require from 10-50% investment of your own funds invested to qualify for funding. In addition, a startup business loan is typically limited to $25,000
CASHFLOW / PROFITABILITY - As this is the primary source for repayment of a loan, we review financial statements in order to determine cashflow and profitability. We also look at the personal cash flow and debt service situation of the primary business owner, which might include outside income. A business that is not profitable or not showing cashflow, such as a startup or one which is struggling, can be a challenge to finance unless there are other mitigating factors such as sufficient collateral and/or a good turnaround plan.
BUSINESS INDUSTRY CLIMATE - Some businesses & industries are more difficult to finance as a result of economic or specific industry conditions.

The above is not intended to be an exhaustive description of our underwriting process but might provide you with an idea of the some of the factors we review. In all cases a well written business plan, accompanied by complete and accurate financial statements will provide your best opportunity for funding.

Good luck with your business and please call our loan information hotline if you have questions ~ 303-860-0242, press #1 ~

Equal Treatment of Clients

We do not discriminate on the basis of race, color, religion, gender, marital status, disability, age, national origin or sexual orientation in services or accommodations offered or provided to our employees, clients or guests.