NYC LMI Storefront Loan
The New York City has restarted the loan program that every small business owner have been looking for. The New York City's Storefront Loan for LMI(Low and Medium Income businesses) is finally here.
This program aims to provide aid to small businesses so that they can restart their business which were earlier affected due to the pandemic. The NYC has put aside a fund of $30 million for this program. Many businesses were funded during the 1st round of this program(December 2020) and now the NYC is set to help small businesses under Round - 2 with the balance funds.
Now let us discuss about the basics of this loan program:
- Loan amount: up to $100,000
- Loan term: 60 months, including no payments the first six months
- Interest rate: 0%
- Pre-payment penalty: none
- Closing fee: $300 (only if loan is approved)
Is my business eligible for this loan?
This is the first question that comes in the mind of every business owner who wants to apply. And, I know you all are eager to know whether your business is eligible for this loan or not. So let me tell you, Only a small business which:
- Operates in an eligible LMI zipcodes
- Employs between 2-99 employees across all locations
- Is Operating since January 1, 2018 or before
- Is cash flow positive in 2019 and be able to demonstrate the ability to repay
- Has no personal or business tax liens or legal judgements within the past three years
- Provide a personal guarantee for the loan. All owners of 20% or more of the business must co-sign on the loan and must have an average personal credit score of 625 or higher.
So these are the eligibility criteria a business must crack to get this funding.
Now let's talk about when to apply for this loan:
The programs has already started from July 7 onwards and small business owners are rushing to the NYC Business portal to apply for it. The clock is ticking very fast as the program is set to be closed on August 17th. So I would suggest that this is the right time to apply or else the funds will get exhausted.
How to apply for the LMI Storefront Loan?
In order to apply for the Storefront Loan, you must have an account on the NYC Small Business Services(SBS) portal. If you don't have an account, you should create one, which is very easy.
You just have to provide some basic details about your business, a declaration that your business meets all the eligibility criteria and must provide a signed authorisation form(which is to be signed by each owner above 20% holding in business) in the end of the application process.
After this comes the documentation process.
This one is a bit tricky process, before I tell you why am I saying this, let us have a look at the list of documents required to apply:
- Previous 3 years Tax returns of the business
- Previous 3 years Personal Tax returns of the owners
- Government-issued Photo ID of each owner
- Business Bank statements for the period Oct-Dec 2019
- Void Check from Business' Bank account
- Business Debt Schedule
- Interim Business financials(within the last 60 days)
- Monthly projections for a period of one year
- Personal Financial Statement for each owner
- Pandemic Questionnaire
- IRS Form 4506-C for business
So, these all are the requirements that you must provide in order to get this loan.This is not at all easy as it seems for an small business owner to apply on his own for the loan. I would rather suggest you to contact a CPA who can assist you in all the application and documentation process for this loan.
Need assistance with the application?
Braj Aggarwal, CPA accounting professionals are here to help you with the prequalification and paperwork.To learn more about our Accounting services & tax preparation services or connect with our team by filling the form below.
I hope this article finds you helpful and has cleared all your doubts if you're looking for this funding.
