Key Benefits of the CRF Loan Program

It is a loan-to-VALUE financing program. Not the lower of cost or value, but value!
The term of the CRF portion being financed more closely matches the life of the fixed asset being financed.
A lower "down payment" (10% or 15%) versus the 25% to 30% typically required for conventional financing, preserves business cash for more urgently needed working capital requirements.
Because the CRF portion is a second mortgage and subordinate to a regular bank loan, risks are minimized to the financial institution, allowing a bank to more competitively position its own market terms and rates on CRF projects.

CRF Loan Structuring

The structure and relative financing shares associated with the CRF Loan Program approximate those of the SBA 504 Loan Program, with the one key difference being that CRF loans are LOAN-TO-VALUE loans. The appraised value of the real estate or equipment involved in the project defines how much can be borrowed or financed using the CRF Loan Program.

There are two available structures under the program, depending on whether or not the CRF share will be greater or less than $500,000.

If the CRF portion of the financing project is $500,000 or less, the total financing package (partner bank lender’s first mortgage loan + CRF second mortgage loan) can be at 90% loan to value.
If the CRF portion of the financing project is more than $500,000, the total financing package (partner bank lender’s first mortgage loan + CRF second mortgage loan) can be no higher than 85% loan to value.

Generally, the CRF loan component must be at least $50,000 and usually will not exceed $1,000,000 (although exceptions are possible on projects involving particularly strong credits).