Service Area:

WWDC services the entire State of Wisconsin.

Eligible Businesses:

Most for-profit proprietorships, partnerships, corporations, limited liability companies, or producer co-operatives are eligible when they meet SBA size standards. The exceptions are nonprofits, gambling concerns, businesses primarily engaged in lending or investment, and unregulated media firms.

Use of Proceeds:

The proceeds can be used to finance plant construction, conversion, expansion, renovation or restoration, the purchase of land and the purchase of machinery and equipment. Job creation is important. The proceeds cannot be used to finance working capital or for debt refinancing (with certain exceptions).

Business Assistance Plans Available from WWDC:

1. SBA 504 Loan Program:

Under this plan, the business buys the property being financed, and WWDC is a conduit through which SBA-guaranteed debentures and non-federal financing flow to the small business concern. Under this plan, the business has title to the property, and under the first mortgage formula, a bank is entitled to make a direct loan to the business in exchange for the first mortgage. Proceeds from the SBA-guaranteed debenture are sent to WWDC, which re-lends to the business, in exchange for a second mortgage, which is then assigned to the SBA.

2. Lease Plan:

Under this plan, WWDC owns the property and leases it to the business (including lease-purchase and lease-with-an-option-to-purchase). WWDC uses the proceeds from the non-federal sources to purchase property or construct or renovate the property for the business concern.

Typical Loan Structure:

Rate of Interest:

Banks and others lend at their current variable or fixed rates of interest. Interest on the SBA-guaranteed debenture is fixed at near long-term U.S. Treasury bond rates. The debenture sale that determines the rate occurs after loan closing.

Term:

Maturities of 10 and 20 years are available.

Loan Processing Procedures and Fees:

The SBA has certain guidelines that must be followed. A commitment fee and annual service fee based only on the debenture will be charged. WWDC can provide you with the specific fee information.

Benefits of the SBA 504 Program:

1. Below-market, fixed interest rates: 40% of the loan will be fixed and near long-term average U.S. Treasury bond rates.
2. It can be used for a wide range of fixed asset purposes: land, buildings, and machinery and equipment.
3. It can handle large loan projects: The current maximum on the SBA portion is $1million.
4. Terms can be fixed on portions of the loan so that you will know your cost of money, which will assist you in your long-term profit planning.

Other Services:

WWDC can also help your business by processing other SBA loan program applications (such as the 7(a) program).