DIRECT LOANS

Open in new Tab DIRECT LOANS Checking your eligibility or exploring your financing options? START HERE: Submit Financing Interest Form APPLY HERE New Jersey businesses in need of financing and committed to job creation/ retention may be eligible for Direct loans through the NJEDA when conventional financing is not available. AMOUNT Up to $2 million for fixed assets ______________ Up to $750,000 for working capital BENEFITS Lower interest rates ______________ Longer terms ELIGIBILITY Businesses must commit to the retention and/or creation of one new full-time job for every $65,000 of NJEDA exposure within 2 years. 1.1x debt service coverage ratio; 1.0x debt service coverage for non-profits. ______________ Must be able to provide fixed assets ( real property and machinery/equipment). Homebased businesses are ineligible. Direct loans are one solution in the NJEDA’s portfolio of programs designed to increase access to capital and support the growth of small businesses in New Jersey. PROGRAM DETAILS ELIGIBILITY TERM & FEES MORE INFO QUESTIONS PROGRAM DETAILS New Jersey businesses in need of financing and committed to job creation/retention may be eligible for direct loans through EDA when financing is not available under other EDA financing programs. Up to $2 million for fixed assets*, or up to $750,000 for working capital to be used for fixed assets or working capital Direct Loans offer companies lower interest rates, longer terms, and a fixed rate. EDA direct loans provide the following terms: Up to 5 years for working capital, up to 10 years for new equipment and 5 years for used equipment, and 20 years for real estate transactions. Based on the 5-year US Treasury or floor of 1%, whichever is higher, with basis point additions for credit risk. * Pursuant to P.L.2017, c.261, direct loans of up to $3 million may be available to qualified businesses in targeted urban centers, regional centers, and metropolitan planning areas. ELIGIBILITY To be eligible for this program, the applicant must*: commit to the retention and/or creation of one new full-time job for every $65,000 of NJEDA exposure within 2 years; have a 1.1X Debt Service Coverage Ratio (for businesses; 1.0X Debt Service Coverage have been in operation for at least 2 years; and be able to provide fixed assets ( real property and machinery/equipment). Homebased businesses are ineligible. *Other credit criteria may apply TERMS Based on the 5-year US Treasury or floor of 1%, whichever is higher, with basis point additions for credit risk. FEES** Application Fee: $1,000 Commitment Fee: 0.875% of loan amount Closing Fee: 0.875% of loan amount * * All fees are non-refundable TAX CLEARANCE CERTIFICATE Division of Taxation Tax Clearance Certificate required.  Certificates may be requested through the  State of New Jersey’s Premier Business Services (PBS) online portal . Under the Tax & Revenue Center, select Tax Services then select Business Incentive Tax Clearance If the applicant’s account is in compliance with its tax obligations and no liabilities exist, the Business Incentive Tax Clearance can be printed directly through PBS. Additional, instructions detailing how to secure your tax clearance certificate are available for download . Please be advised: It is the applicant/client’s responsibility to maintain a current and clear tax clearance certificate.  If a current and clear certificate is not evidenced to NJEDA at time of closing, NJEDA will not proceed with closing. PREVAILING WAGE Projects utilizing NJEDA financial assistance for construction related costs are subject to state prevailing wage requirements.