AltCap Offers Loans with More Flexible Eligibility Requirements to Help More Underserved Businesses in MO, KSJake Slobe
Are you a small business owner having trouble securing capital? You might be in luck!
AltCap, a Kansas City-based community development financial institution in the KCSourceLink Resource Partner Network, has been approved by the U.S. Small Business Administration as a lender for the Community Advantage Pilot Loan Program. With this new authorization, AltCap can now offer loans with more flexible eligibility requirements to disadvantaged small businesses located in Kansas and Missouri.
AltCap has been serving communities and small businesses for over 15 years, focusing on those that have been overlooked and underserved by traditional financial institutions. These Community Advantage loans will allow AltCap to expand its support further, benefiting even more entrepreneurs in the region.
What is the SBA Community Advantage Loan Program?
But what exactly is the SBA Community Advantage Loan Program? Well, it’s part of the U.S. Small Business Administration’s 7(a) loan program. These loans are specifically designed to provide financing to small businesses in underserved markets. Think of new businesses, veteran-owned companies and businesses located in low-income communities.
Community Advantage loans are a great alternative for business owners who can’t secure financing through traditional loan programs. They offer competitive interest rates, flexible repayment terms and have more lenient qualification requirements compared to other SBA loans. So, if you’re struggling to find the right funding for your Kansas City business, this could be a game-changer for you.
These loans range from up to $50,000 to $250,000 and can be used for various purposes, like real estate purchases, business expansions or renovations, equipment purchases and working capital. Typically, businesses need an excellent credit score to qualify for an SBA loan, but the Community Advantage program is more lenient and requires a minimum score of just 140.
“It’s another product for folks that can’t get traditional lending for whatever the case might be,” said Carmen Lopez-Murguia, vice president of Lending and Client Services. “Community Advantage loans are a great avenue for business owners unable to receive financing through traditional loan programs.”
> > > There are many ways to fund your business. Learn how to find loans, grants and equity funding for your Kansas City business — and who can help — in our in-depth funding guide.
What types of businesses are right for the Community Advantage program?
These loans are specifically geared towards for-profit small businesses in underserved communities that need capital to launch or grow. AltCap’s focus is on providing loans to businesses in low-income areas and rural towns. So, if your business has been operating for less than three years and doesn’t qualify for traditional financing elsewhere, Community Advantage loans could be the perfect solution for you.
“Typically, these businesses have been operating for less than three years and do not qualify for traditional financing elsewhere,” Lopez-Murguia says.
While traditional 7(a) loans are issued by SBA lenders like national and regional banks, Community Advantage loans are guaranteed specifically for “mission-oriented lenders, primarily nonprofit financial intermediaries focused on economic development,” making them more accessible to these communities.
Because the Community Advantage program has more flexible eligibility requirements than standard 7(a) loans, it is an ideal option for businesses in “risky” industries like food & beverage, and for women, BIPOC and veteran entrepreneurs who may face barriers for traditional funding.
To ensure that the loans are reaching the right places, the SBA requires that Community Advantage lenders make at least 60 percent of their loans in defined “underserved markets.” These markets include low-to-moderate income communities, businesses where more than 50% of the full-time workforce is low-income or resides in a low-income community, legally defined empowerment zones and enterprise communities, HUBZones, new businesses (firms in business for no more than two years), veteran-owned businesses and rural areas.
So, if you’re a small business owner in Kansas or Missouri, and you’re looking for financing to take your business to the next level, consider checking out AltCap and their Community Advantage loans. They’ve got the experience, the commitment and the resources to help you succeed.
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