Second Chance Microloan Program
The KPEDD Microloan Fund is intended to provide financing for small businesses for which other types of financing might not be available. This program is designed to identify the needs of applicants when traditional funding sources have been denied and help applicants become viable candidates for traditional commercial lending. the intent is not for hobbyists or other personal use. Loans from this program should help new and existing business create jobs, expand services, or operational capabilities that enhance, foster, and promote responsible economic development, which is the mission of this organization.
Parameters of the loan
- Minimum loan amount is $2,500; maximum is $25,000
- Maximum loan term under $10,000 is 3 years (36 months) and over $10,000 is 4 years (48 months)
- Interest rates will be fixed at the Wall Street Journal prime rate plus 4% not to exceed the Alaska State Law
- Annual servicing contribution will be required for all loans
- Borrower will pay all closing costs
- Borrowers should inject a minimum of 10% equity (non-borrowed) investment into the business or project.
- Non-refundable processing fee of $50 – 51% of the owners will be required to personally guarantee the loan
Microloan Funding Uses
- Business must be physically be located in the Kenai Peninsula Borough
- Startup costs of a legitimate for-profit business
- Purchase equipment