Details of Conventional Loans
Purchase of or improvements to commercial real estate, leasehold improvements, machinery and equipment, fixtures and furniture, inventory and other business assets; to provide working capital; to refinance certain debt; to purchase a business; and to pay loan closing costs.
Up to $500,000.
To be determined at time of deal structure.
The term of a conventional loan will be determined on a case-by-case basis. Loan amortization will typically match useful life of assets being financed.
Consumer and business credit reports, income tax verification and initial environmental screening – up to $650.00.
Loan fees may be financed in the loan.
Your Good Faith Deposit will be used to offset loan underwriting and closing expenses. Appraisals and further environmental expenses are not included in your Good Faith Deposit and are collected separately prior to the engagement of any such professional services.
The loan must be fully secured (on a discounted basis) by commercial real estate or a combination of commercial real estate, residential real estate, and machinery and equipment.
All principals who own 20% or more of the business are required to provide a full guarantee. Principals or key managers owning less than 20% may be required to provide a guarantee on a case-by-case basis.
When necessary to secure a collateral position, ACC Capital will require the guarantee of a non-owner spouse to the extent of the spouse’s interest in the collateral.The guarantee of affiliated companies may be required based upon the percentage of ownership of the affiliate and the borrower’s relationship with the affiliate.
Other Considerations and Requirements
CASH / EQUITY / ASSET INJECTION
Evidence must be provided by the applicant prior to any loan closing and disbursement.
SUBORDINATION / STANDBY DEBT AGREEMENTS
Standby creditor must subordinate any lien rights in collateral securing a loan to the lender’s rights in the collateral and agree to take no action against applicant or any collateral securing the Standby Debt without lender’s consent.
REAL ESTATE APPRAISALS
Required for all Real Estate purchased or used as collateral.
EQUIPMENT APPRAISALS
Required to substantiate the value of any used machinery and/or equipment.
ENVIRONMENTAL REPORTS
Required for all Real Estate purchased or used as collateral.
LATE CHARGE
A late charge (not to exceed $100) in the amount of five percent (5%) of the amount of any payment which is not made within ten (10) days of the date the payment is due will be collected from the Borrower.
LOAN PROCEEDS
ACC Capital must document that the borrower used the loan proceeds for the approved purposes.
INSURANCE
Property insurance (fire and theft, extended coverage and liability) will be required. All personal and real property shall be insured for replacement cost. Insurance coverage for improvements to real property must contain a Mortgagee Clause in favor of lender. Insurance coverage for personal property must contain a Lender’s Loss Payable Clause in favor of lender. Additionally, the policy must provide written notice at least 10 days prior of policy cancellation.
LIFE INSURANCE
The key principals of the operating company may be required to provide an assignment of life insurance in the amount of the loan.
FLOOD INSURANCE
Will be required if the property is located within a flood area.
WORKERS’ COMPENSATION INSURANCE
Will be required in amounts meeting state law requirements.
VERIFICATION OF FINANCIAL INFORMATION
ACC Capital must verify the applicant’s last 3 years (unless applicant is a start-up business) of tax returns submitted to IRS via IRS Form 4506-T.
LEASE TERM
Lease(s), including options, on all business premises where collateral is located should be for as least as long as the term of the loan.
ASSIGNMENT OF RENTS
A perfected assignment of all rents paid under a lease between an Eligible Passive Concern (Real Estate Holding Company) and the applicant Operating Company is required.
LANDLORD’S WAIVER
Applicant must provide lender access to any leased premises and facilities where collateral is located with an executed Landlord’s Waiver.
NEW CONSTRUCTION
Evidence of compliance with the “National Earthquake Hazards Reduction Program Recommended Provisions for the Development of Seismic Regulations for New Buildings” (NEHRP) or a building code that has substantially equivalent provisions is required.
DO-IT-YOURSELF
Construction or Installation of Machinery & Equipment: Except under special circumstances, will not be permitted.
COST OVERRUNS
Applicant must show ability to pay cost overruns, if any.
LIEN WAIVERS
Applicant must provide lien waivers or releases from all materialmen, contractors, and subcontractors involved in any construction.
OCCUPANCY
- Existing Real Estate Improvements occupy at least 51% of the property.
- New Construction occupy at least 60% of the property.
FRANCHISED OPERATIONS
All franchised operations not listed on the Franchise Registry must pass a legal review of the applicant’s Franchise Agreement and Franchisor’s Disclosure Statement.
CHILD SUPPORT
Certification from applicant that any required child support is no more than 60 days delinquent.
CURRENT TAXES
Applicant must be current on all federal, state, and local taxes, including but not limited to income taxes, payroll taxes, real estate taxes, and sales taxes.
GOOD FAITH DEPOSITS
A Good Faith Deposit (see below schedule) shall be required and applied to Six Bridges Capital Corporation’s processing fee and other costs associated with credit investigation and underwriting. If approval is not obtained, the Good Faith Deposit shall be refunded (less the cost of credit verification, environmental screening, IRS filing verification and any other out of pocket expenses incurred by 6BCC).
- $2,500 SBA 504 Debentures of $500,000 and less
- $3,500 SBA 504 Debentures of $500,001 to $999,000
- $5,000 SBA 504 Debentures of $1,000,000 and over
IMMIGRATION LAWS
Neither the Borrower nor Operating Company has been determined by the Secretary of Homeland Security or the Attorney General to have engaged in a pattern or practice of hiring an alien, recruiting an alien or referring an alien for a fee for employment in the United States, knowing that the person is an unauthorized alien.
