Utah State Small Business Credit Initiative
Contact information:
Jonathan Hardy
Director, Utah State Small Business Credit Initiative
801-526-9456
jhardy@utah.gov
Program Information
Utah Program Application to Deptartment of Treasury
Eligible Applicants:
- Small businesses defined as having less than 500 employees
- Have been turned down for traditional credit resources
- Application sponsored by a participating financial institution
Loan Guarantee Program:
- Up to 80% Guarantee of Principal Loan Amount
- Terms up to 7 Years
- Target average term of 3 years
- 4% Guarantee Fee
- Target 3% or less True Loss Rate
- Loan Loss Reserve fund maintained at a minimum of 10% of outstanding guarantees
- Program can guarantee up to $118 Million in transactions from the original allocation with fees and guarantee expirations allowing for increased obligations in the future.
Loan Participation Program
- Up to 80% purchased or primary participation in a loan transaction
- Flexible terms and rate
- Origination fees apply (To be determined)
- Target 3% or less True Loss Rate
- Program can use approximately $1.3 Million in funds for participation with future fees and interest income from either program to increase lending capacity in the future.
Basic Prohibitions
- Lending on Passive Investments
- Speculative Activities that develop profits from fluctuations in price rather than the normal course of trade
- Financial Institutions as borrowers unless it is a Community Development Financial Institution
- Transactions outside the State of Utah
- Lending to persons convicted of a sex offense against a minor or participating with a financial institution that has an officer who has been convicted of the same.
- Proceeds not used to refinance an existing transaction, payoff taxes owed, or reimburse any owner for equity invested
- Pyramid Schemes
- Gambling Enterprises