SBA Community Advantage

Community Advantage is a pilot initiative by the SBA aimed at increasing access to capital for underserved communities and borrowers.  The maximum loan guarantee size is $250,000 and the SBA will guarantee up to 85 percent of the loan.  In some cases, no private lender is required.  Uses include fixed assets, buildings and component working capital if a fixed asset is a portion of the request.

Taverns, liquor stores, and gun shops are not eligible for financing.

Lending Structure
A project can be funded with private lender and at times without:

Lender Financing $187,500 50%
MEDC Financing $150,000 40%
Borrower Equity $37,500 10%
Total Project $375,000 100%

Lending Criteria

  • Business must be located in the City of Milwaukee
  • Project must create or retain jobs
  • Project involves one or more of the following: business purchase, land and building purchases, new construction, renovations, or equipment purchases
  • Limited working capital financing may be provided if fixed assets are a part of the total project
  • Real estate projects require 51% owner occupancy

Loan Terms

  • Maximum Loan Size: $250,000

  • Guarantee: 85 percent for loans up to $150,000 (guarantee fees waived) and 75 percent for those greater than $150,000 (3% guarantee fee).

  • Loan amortization is based on the useful life of the assets up to 20 years, and matches the term of the participating lender

  • Fixed interest rates are set at time of loan apporval, and are below current market rates.   

  • Personal guarantees of owners are required
  • The guarantee of operating business is required
  • MEDC takes a first lien position
  • No prepayment penalty
  • Borrowers must pay MEDC attorney fees of approximately $3,000 to $3,500 for loan closing costs and document preparation




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