|Loan Amounts||Repayment Terms||Rate||Fees|
|$500-$50,000||3 to 60 months||8%-12%||2% + out of pocket costs|
Uses for Microloans
- Purchase assets for your business, such as vehicles, equipment and fixtures
- Business expansion or opening a new location
- Building and tenant improvements
- Working capital
- Other uses may be considered as well
Funds cannot be used for:
- Business operating deficits
- Personal income
- Emergency situations
- Pre-Startup research and development
- Speculative property (real estate, stock, collectibles)
- Non-accredited trainings, seminars, or workshop fees or educational materials
- Businesses engaged in illegal activities or activities deemed to be socially or environmentally degrading
HOW TO QUALIFY FOR A LOAN
Business Plan: While a written business plan isn’t necessarily required, you should be able to address what is compelling about your product or service, why you are qualified to make this business succeed, and how you will be able to grow your business. It is also important to demonstrate that you have a mentor or an adviser, experience in your industry, and have completed any business training and education you need.
- Questions to answer in a business plan.
- Find a mentor in your industry.
- Find an adviser with the relevant expertise.
- Find business training and education.
Repayment Source: If you are starting a small business, it is important to have a secondary source of repayment to cover personal expenses and make loan payments because it takes time to grow a business. Income from the business will therefore be reinvested back into the business to foster growth. If you are having challenges with your personal income, there are some resources available to you.
Financial Statements: An established business is properly managed through the use accurate financial information,which is utilized to assess pricing and costs, demonstrate capacity for debt financing, and project how the business can grow successfully. For a start-up business, financial projections will demonstrate the relationship between revenues and expenses, goals that need to be met within specified time periods, and the underlying assumptions upon which the projections are based. One important assumption of most start-ups is that a secondary source of income is necessary until the business grows to a sufficient level to sustain personal and business expenses.
- Balance Sheet.
- Income (Profit and Loss) Statement.
- Financial projections template.
- Information on small business taxes.
Personal Credit: Your personal credit score and borrowing history will be considered as a reflection of your experience working with creditors and how you have addressed issues in the past. If you do not have a credit score or history, a loan with Mercy Corps Northwest will help to build your credit by reporting your payments to all three credit bureaus (TransUnion, Equifax, Experian).
- Review a copy of your credit report for free.
- Learn about how your credit score is calculated.
- Repair and correct your personal credit.
Collateral: Most of our loans require collateral as a backup security to the loan, which includes but is not limited to paid off vehicles and equipment that you already own or that will be purchased with loan proceeds. There are options to provide unsecured loans up to $5,000 on a case-by-case basis for qualified entrepreneurs.
- Help with debt management and consolidation.
- Build up assets using an Individual Development Account (IDA).
- Personal Financial Statement.
Have Questions? We can Answer them!