Frequent Questions About
the Utah Microenterprise Loan Fund
________________________________________________________
1.
Who funds the UMLF?
The
UMLF is funded by over 29 banks and financial institutions committed
to helping enterprising people work toward greater financial self-sufficiency
through small business ownership. The UMLF also receives some
funding from local city and county governments. For a complete
listing, click
here.
2.
Is the UMLF a government program or part of the SBA?
No,
the UMLF is a private, non-profit, multi-bank community development
corporation that serves individuals who are unable to qualify
for loans through traditional lending sources.
3.
Can I apply for a UMLF loan for personal needs, such
as
to
purchase
a car or applicance or refinance personal
credit card
debt?
No,
the UMLF only provides loans for opening or expanding small businesses.
Our loans can be used for the purchase of inventory, equipment,
vehicles, computers or if necessary, as capital to cover operational
expenses.
However,
the UMLF will consider the refinance of credit card debt that
has been incurred for the business.
4.
Can I apply for more than one loan from the UMLF?
Yes,
however, you can't have loans totaling more than $25,000 at any
given time.
5.
What information
needs to be included in my Business
Plan?
Your business plan should include
the following information:
- The
type of business you plan to operate
- The
products and/or services you will offer
- The
customers you will target and serve
- The
methods you will use to advertise and promote your business
- Your
experience and background in the type of business you plan to
operate
- The
proposed use for the funding you will receive
- Your
past and projected financial statements for your small business
Your
business plan is the most important component of your loan application!
For a more detailed business plan outline, click
here. To take advantage of the free counseling
and assistance programs provided by our Business Resource Network
Partners Click
here.
6.
Are there any fees associated with microenterprise
loans?
A
$50.00 application fee is required for any microenterprise application.
Other
special loan fees include:
- a
1% origination fee per year of the loan (for example, a 5 year
loan for $10,000 would have a one-time origination fee of $500)
- a
one time $25 - $50 recording fee for every loan
In
all cases, origination and recording fees are financed into the proceeds
of the loan.
7.
Who makes the final decision on whether my loan is
approved?
The
UMLF Credit Committee, comprised of volunteer bankers and small
business owners AND/OR
The
Executive Director, Programs Manager and Credit Committee Chairman
of the UMLF for our "expedited" process. See
below:
| |
Credit
Committee |
Expedited |
New
Business
(less than 1 year old) |
greater
than $5,000 |
Less
than $5,000 |
| Existing
Business |
greater
than $10,000 |
Less
than $10,000 |
8.
What steps do I need to take to close my loan once it is
approved?
After
your loan is approved you will need to provide proof of insurance
on all business assets showing the UMLF as "loss payee."
You
will also need to provide your personal guarantee (and that of
other key owners if you have any), for the repayment of the loan,
as well as a list of assets you now own and those that will
need to be purchased for your small business.
9.
Over the past fifteen years, what types of businesses
has the
UMLF
helped to start or expand?
Over
the past fifteen years, the UMLF has provided loans to a wide
variety of businesses, both traditional and unique.
In
the area of service businesses , we have provided
loans to fund everything from automobile repair, commercial cleaning
and hair cutting to acupuncture and glass blowing.
The
varieties of retail businesses we have funded
have included outlets selling coffee, flowers, specialty food
products and even Spanish newspapers.
Our
loans have also helped manufacturing companies
make and sell such diverse products as custom-made scrapbooks,
handmade quilts and jewelry to Barbie Doll accessories and soap
made from grass clippings.
The
sky is virtually the limit on ideas that can be developed into
a successful small business!
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