Loan Applications
Applications for TCCCF loans will only be considered within the geographic areas served by our member organizations. All loan inquiries and applications should be directed to one of our member representatives. Simply click on Membership Updates on the Membership page to determine which member organization serves your project location. Members can be contacted via email by clicking on the organizational name.
For general information concerning TCCCF loans, please call us at 952-546-9049. A copy of our loan application form may be downloaded as either a Word Document or a PDF file by clicking on either of the two options below.
Loan Criteria
Financing Policies
Loan Amounts:
- $50,000 minimum
- $1,000,000 maximum for standard loans; $1,500,000 for New Markets Tax Credit eligible loans; a limited number of loans of up to $2,000,000 will be considered for certain projects.
Eligible Projects:
- Funded project must be sponsored by a TCCCF Member.
- Borrower may be a for-profit business entity, non-profit corporation, or a cooperative business organization.
- A financial institution must be a participant in the project financing.
Allowable Use of Proceeds:
- TCCCF financing assistance may include, but is not limited to fixed assets, including land and building purchase, building construction, leasehold improvements and renovations; acquisition, renovation or moving machinery and equipment; and working capital loans secured by fixed assets with fixed repayment schedules (not lines of credit).
- Loans may also be used to restructure existing debt.
Ineligible Businesses and Use of Proceeds:
- Speculative real estate developments.
- Bars and Liquor Stores.
- Purchase of equity positions in business enterprises.
Interest Rates:
- Fixed rate loans are available, with rates determined by the TCCCF member originating the loan.
Loan Term Length:
- The term of each loan will be determined on a case-by-case basis, with the primary factor being the collateral offered. Loans secured by real estate will generally not exceed 20 years, although New Markets Tax Credit loans may be approved with a 25 year term. Loans secured by machinery and equipment will generally support a loan term of up to 10 years, not to exceed the depreciated life of the asset being financed. The TCCCF loan will typically coincide with the term of the participating bank loan, including any balloon maturity provisions.
Fees and Charges:
- A 1.75% loan origination fee will be charged to all TCCCF borrowers. This fee will be assessed only for approved loans, but must be paid at or prior to loan closing.
- A 0.5% loan underwriting fee shall be paid by the borrower at loan closing.
- Borrowers are responsible for paying all legal and other loan closing costs incurred by TCCCF.
Credit Criteria
Equity or Cash Requirements:
- Loan applicants must demonstrate an acceptable level of project equity, with a minimum of 10% equity provided by the borrower. Subordinated debt within the same project financing may be considered as additional equity, subject to an intercreditor agreement. All other criteria will apply, including subordinate debt, when calculating debt coverage.
Collateral Requirements:
- Loan collateral coverage must be at least 90% of the TCCCF loan amount on appraised value of assets, less all senior debt.
- TCCCF will consider the following collateral positions: first security interest, shared first security interest, subordinated security interest and shared subordinated security interest.
Debt to Worth:
- TCCCF will consider financing projects that have a tangible net worth ratio on an actual and proforma basis of no greater than 10 to 1 (10% project equity or greater). Each project shall be analyzed on its own merits and its ability to service both existing and new debt.
- TCCCF borrowers (real estate holding companies excluded) should have a tangible net worth of 5 to 1 or less, based upon their most recent financial statements and, on a proforma basis, reflecting the new proposed debt.
Personal Guarantees:
- Personal guarantees will be required for all owners with 20% or greater ownership in closely held businesses.
Management Experience & Company Performance:
- The TCCCF will require that the project have capable, skilled management through experience or expertise in the applicant’s industry, either through previous successful business ownership or through appropriate managerial support services. Borrowers having erratic or undocumented earnings, or borrowers having new and unproven management, will require more loan risk sharing by the TCCCF member originating the loan.
Repayment Ability:
- Applicants must demonstrate adequate historical cash flow showing trends that support debt service coverage of at least 1.1 to 1. Proforma financial cash flows must also support debt service coverage of at least one to one.
