Areas Served: Mobile Alabama
The Retail Forgivable Loan Program is designed to promote new and additional retail business operations in selected areas of Downtown Mobile Alabama.
The Program will offer loans from the Downtown Mobile Alliance, Inc. (DMA), which can be forgiven with no principal or interest due if the business remains in operation for at least five (5) years.
DMA Loan Terms The DMA Retail Forgivable Loan will: – Be limited to a maximum forgivable loan amount of $20,000. – Require a borrower equity investment equal to at least 50% of the total project cost, meaning that for every dollar of DMA forgivable loan there must be at least one dollar of personal financing.
– Be amortized monthly over a 5-year period at a 0% interest rate.
– Require that during the term of the loan monthly principal payments be made by the borrower into an account maintained by the DMA based on the amortization (repayment) schedule.
– Require that, after each business year, the retail business must open for customer operations at least 48 hours per week, submit a financial statement to the DMA showing a going concern,and be subject to a credit rating check.
– Provide for forgiveness of (a) 60% of the principal amount of the loan at the conclusion of the 3rd year of the term, (b) 20% of the principal amount of the loan at the conclusion of the 4th year of the term, and (c) 20% of the principal amount of the loan at the conclusion of the 5th year of the term.
To be eligible for forgiveness of any portion of the loan, the borrower must be in compliance with the terms of the loan.
– Require personal guarantees from all owners of the retail business.
– Require that the loan proceeds are disbursed after the borrower equity investment.
– Require that a non-refundable loan fee of 3% be paid upon submission of the application for a retail forgivable loan.
– Following preliminary approval of the loan by the DMA Incentives Committee, require that the applicant pay one-half of the fee for the DMA’s retail consultant to review the loan application.
The total fee is $650, meaning that the applicant is responsible for paying $325. The DMA will pay the balance of the fee.
– In the event of a default, the loan will immediately begin to accrue interest at the default rate of intereSt. The default rate of interest is 12%.
Contact InformationDowntown Mobile Alliance, Inc
Address: 261 Dauphin St
City: Mobile
State: Alabama
Website:
http://www.downtownmobile.org/pdf/RetailForgivableLoanProgram.pdf
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