What is CRF? Community Reinvestment Fund, USA (CRF) is a non-profit organization that brings together community development lenders and socially-motivated and market rate investors to increase the amount of capital funneled into economically underserved communities nationwide. They make this happen by operating the secondary market for community development financing. Since 1988, CRF has injected more than $450 million into economically disadvantaged communities to help stimulate job creation and economic development. How does CRF differ from the SBA 504 Program? CRF can be a great alternative to those borrowers that are good credit risks but simply do not qualify for an SBA 504 loan due to technical reasons. For example, a borrower may have “used up” their available SBA financing allocation, they may be a non-profit organization, they may have a 912 issue that excludes them from the 504 or they may be trying to refinance their existing debt. Another benefit of the CRF program is that there is no maximum personal or business net worth threshold as there is with the 504 product. CRF offers two business loan products: CRF Business Loans and New Markets Tax Credit (NMTC) Business Loans. Both products have similar underwriting criteria. The NMTC program offers better pricing for borrowers located in economically disadvantaged communities. What are the key features of CRF’s Business Loan Programs? CRF loans can be used to purchase or renovate a building where a business is located; purchase a new building to expand a business; purchase an existing business by a seasoned management team; or restructure company finances. CRF loans offer terms up to 25 years, and loans can be secured by first or second liens on the collateral. Borrowers with businesses located in disadvantaged communities may qualify for the NMTC program with interest rates comparable to the SBA 504 program. CRF provides an advance commitment to fund its loans whenever the acquisition or construction is complete. There is no need for banks to provide temporary funding at the final closing. What else do I need to know about CRF Business Loans? CRF requires at least two years management experience in the company or management experience in the same industry of at least five years (i.e. Start-up businesses will not qualify for CRF financing). CRF can finance a minimum total project of $250,000 (minimum $100,000 CRF portion) with no maximum project size. CRF will provide up to $2.5 million in financing on a NMTC Business and up to $1.0 million in financing on a business that is not located in a NMTC area. Somercor can determine whether or not a business is located in a NMTC area by completing mapping of the business location. This can be done at the request of the bank or borrower. Who can I contact for more information on the CRF Program? You can contact Ben DeVries at Somercor for more information. He can be contacted at (312) 360-3311 or by email at devries@somercor.com.