We look towards the profitability of the operation, the projections to make sure that they’re able to pay back. It’s not a grant. These are loans. They’re extended loans unlike banks that might have three and five year maximum loans. SBA loans could go seven and 10 years up to 25 years. And so what we look at in terms of how we rate a borrower, for one, we have credit scores that are a little bit lower than traditional lenders. The lender can use the SBAs credit SCORE model or they can use their own model to determine credit worthiness. The other thing we look at is like I said, the ability to pay back the loan and collateral is what’s on the table.
If they have collateral, they don’t have collateral, we just want to make sure that if the business is, it has collateral to provide SBA, then SBA will take that collateral. If they don’t, that’s not a condition not to payday loans Ashtabula use SBA. It’s up to the lender. And here’s the other thing too for those businesses that only need 20 and 25,000 and there are a lot of them out there. We have a micro loan program that’s up to $50,000. This is not through the bank. These are through community organizations that have been chartered by SBA. We provide them the micro loan dollars and then they are the ones that underwrite and approve the loan to that small business. And a lot of the borrowers that use that program are home-based businesses. I want to do a taco truck. I want to leave my 20 hour restaurant business and I want to now go into having my own truck. That’s what that loan opportunity is about. And that’s called the micro loan program and it’s up to $50,000 and that’s through our community loan funds.
You could actually go on to and search for micro loans and you’ll see the state.