COVID-19 UPDATE: LA City Small Business Emergency Microloan Program

Los Angeles City Small Business Emergency Microloan Program The City of Los Angeles has just recently established the Small Business Emergency Microloan Program. This program now provides financing needed to strengthen small business enterprises in this time of acute need that have been affected by the COVID-19 outbreak. Businesses that meet the criteria below may apply online for a City of LA Small Business Emergency Microloan To apply, register through our through the city’s secure log-in system. Below is the information you will need to know prior to submitting an application.

Microloan Terms

Loan Limits

$5,000 to $20,000

Interest Rates

Option 1: 0% for a term of up to 18 months, with repayment deferred for up to 6 months
Option 2: 3% for a term of up to 5 years, with repayment deferred for up to 12 months (for profit businesses)
Option 3: 2% for a term of up to 5 years, with repayment deferred for up to 12 months (for tax-exempt businesses)

Prepayment Penalty

None

Term

18 months to 5 years

Loan Fee

No fee

Admin Fee

No fee

Application Fee

No fee

Eligible Uses

Working capital only

Loan-to-Value Ratio

100%

Eligible Borrowers

For-profit and tax-exempt businesses in the City of LA with 100 or fewer employees that have been negatively impacted by the COVID-19 outbreak and will make their best effort to continue or re-establish their business operations and employees

Borrower Eligibility Certification

Business must have a Business Tax Registration Certificate with the City of Los Angeles' Office of Finance that was filed prior to March 01, 2020

Credit

There is no credit minimum, however the principal business owner(s) must have reasonable and responsible personal credit history and an acceptable explanation for any derogatory marks Bankruptcies and debt write-offs must be at least 12 months old

Cash Flow

Businesses must show that historical profits would have been sufficient to service the requested debt and that they have been impacted by the COVID-19 outbreak

Location

Primary business operation must be physically located in a commercial–use building within City of Los Angeles boundaries (please use this City of LA online zoning tool to determine business location)

Collateral