The Economic Development Authority of the City of Lynchburg voted on April 30, 2020, to carve out a portion of their existing Revolving Loan Fund to convert it into a Business Recovery Loan for businesses impacted by COVID-19.
Applications will be reviewed in the order they are received. Applications received without the required documentation will not considered. Economic Development Authority of the City of Lynchburg Business Recovery Loan Funds are not forgivable. Businesses that have been approved for or received federal funding via the Coronavirus Aid, Relief, and Economic Security Act (EIDL, EIDL Advance, or PPP ) funding are not eligible to apply for this fund.
The Economic Development Authority of the City of Lynchburg Business Recovery Loan Fund cannot be used for the refinancing of existing debt.
COVID Business Recovery Loan
- Minimum loan size will be $5,000 up to a maximum of $25,000. Loans will not exceed $25,000 for any one company.
- The EDA Business Recovery Loan interest rate will be a fixed rate based on current prime rate at closing, minus 1%.
- Application fee and origination fees will be waived.
- Security may be required on loan request.
- Personal guarantee(s) will be required in all loan requests.
- Business has not been approved or receive EIDL, EIDL Advance, or PPP Funding
- Independently owned
- A small business, which is defined as: A business that is 1. Independently owned, 2. With net worth or net assets not to exceed $6 million, 3. With average net profit after federal income taxes for the preceding two years of less than $2,000,000, and 4. With less than 25 employees
- Located in the City of Lynchburg
- Business must have been in operation in 2018
- Must be current on all City taxes through February 29,2020
- Business must agree to wraparound services provided by applying for this loan, including meeting with the Small Business Development Center and with the Office of Economic Development & Tourism to discuss health and safety protocols and procedures.
- Accounts Payable
- Loans can be up to four (4) months of your average payroll in 2019 not to exceed $25,000.00
- Loan Range-$5,000 -$25,000.00
- Application fee –waived
- Origination fee-waived
- Interest rate fixed at WSJ prime minus one percent.
- Loan term 60 months
- Loan request over $5,000.00 will require collateral
- Loan must have personal guarantee of all owners
- Principal and Interest payments deferred for six (6) months; interest only following 6 months.
- Loan is NOT forgivable
- 2019 Profit & Loss and Balance Sheet (if 2019 tax returns are not completed)
- Last two years business tax returns
- Personal tax returns for the past two years
- Personal financial statement of all owners of the business
- Business schedule of outstanding debts
- Copies of driver’s licenses of all owners
- Copies of Articles of Incorporation/LLC Operating Agreement/Partnership Agreement
- Copy of City of Lynchburg Business License
- Summary of how relief funds will be utilized