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  • Tunkhannock Borough Revolving Loan Funds Available

    Tunkhannock Borough Revolving Loan Fund

     

    Objectives & General Information

    Tunkhannock Borough Revolving Loan Fund Program (“TB-RLF”) is a low interest loan program designed to financially assist commercial businesses and non-profit entities in Tunkhannock Borough, Pennsylvania with low interest loans for projects that revitalize the commercial area and business community in Tunkhannock Borough. It is designed to increase the quantity and quality of available job opportunities in the Borough of Tunkhannock. The purpose is to create a positive, business-friendly economic climate to stimulate commercial growth and expansion which will improve the overall economy of Tunkhannock Borough, Pennsylvania.
     

    Eligibility Guidelines

    Applicants must be located within the Borough of Tunkhannock, Pennsylvania.
    Funds borrowed from the TB-RLF may be used for any business expenses related to the expansion or improvement of the applicant, to include purchase and/or installation of machinery or equipment, land assembly and acquisition, real estate development including redevelopment or rehabilitation, facade development, facility modernization, inventory and working capital. Funds may not be used to refinance existing debt or to replace capital contributions.
     

    Interest Rates & Terms of Loans

    To be determined by the TB-RLF Committee.
     
    TB-RLF Committee reserves the right to determine the dollar amount of loans granted, based on applicant need, not to exceed $25,000.00, number of jobs created or retained, and the funds available in the TB-RLF Portfolio. The general guideline shall limit loan dollars’ availability to no greater than ninety percent (90%) of the total project costs, with the funding balance from private loans (bankers and other lenders) and owners’ contributions (equity).
     
    The business and non-profit entity receiving the loan assistance will be financially responsible for all loan costs associated with the completion of the loan transaction. Incurred costs will be deducted from the proceeds of the loan at the time of closing. Closing costs may include, but are not limited to, credit verification fees, UCC-I filing fees, the cost of establishing payment coupon books, attorney’s fees, legal fees, appraisal fees, and costs associated with codes enforcement inspections.
     
    All loans will be negotiated at an interest rate lower than prime fixed rate and approved by the TB- RLF Committee at the time of the loan commitment. The rate determination will be based on several factors, to include start-up or existing business, management experience, term, collateral, personal guarantees, use of proceeds, debt-to-income ratios, and debt-to-net worth ratios.
     
    The term of the loan shall be determined by the TB-RLF Committee, taking into consideration the purpose of the loan, the life expectancy of the assets financed and the ability of the borrower to service the debt from cash flow or asset conversion.
     
    For loan application and additional information contact: Borough Manager
    Tunkhannock Borough 126 Warren Street
    Tunkhannock, PA 18657
    (570) 836-1548
     
    Initial funding for the TB-RLF Program was made possible through the Pennsylvania Department of Community & Economic Development (DCED) Anchor Building Component of the New Communities Program.
     
    TB-RLF LOAN PROCEDURES
     
     
     


    The Tunkhannock Borough Revolving Loan Fund (“TB-RLF”) is a low interest loan program designed to assist Tunkhannock Borough eligible businesses and non-profit entities implement business development strategies. It is designed to increase the quantity and quality of available job opportunities in Tunkhannock Borough. The purpose is to create a positive, business- friendly economic climate to stimulate commercial growth and expansion which will improve the overall economy of Borough of Tunkhannock.
     
    The TB-RLF has been established to provide funding to eligible businesses and non-profit entities in Tunkhannock Borough, Pennsylvania.
     
     
    ELIGIBLE ENTITIES: Businesses and non-profit entities must be located within the Borough of Tunkhannock. A business is defined as a sole proprietary, partnership, cooperative or corporation engaged in a profitable business.
     
    USE OF PROCEEDS -- NON-PROFIT ENTITIES:
     
    Projects for non-profit entities funded through the TB-RLF should create or retain jobs in the Borough of Tunkhannock for employees of the non-profit entity, improve the downtown business district in Tunkhannock Borough, and/or act as a catalyst to encourage private investment in commercial or industrial projects located within the Borough of Tunkhannock.
     
    USE OF PROCEEDS -- BUSINESSES:
     
    Projects for business funded through the TB-RLF should create or retain jobs in the Borough of Tunkhannock for employees of the business and may be used for any expense related to the expansion or improvement of the business, to include purchase and/or installation of machinery or equipment, land assembly and acquisition, real estate development including redevelopment or rehabilitation, facility modernization, inventory and working capital of structures located in the Borough of Tunkhannock. Funds may not be used to refinance existing debt or to replace capital contributions.
     
    APPLICATION FEE:
     
    A non-refundable Application Fee of $100.00 payable to the Borough of Tunkhannock is required to process a Loan.
     
    LOAN LIMITS:
     
    TB-RLF Committee reserves the right to determine the dollar amount of loans granted not to exceed $25,000.00, based on applicant need, number of jobs created or preserved, and the funds available in the Revolving Loan Fund, with the funding balance which shall not be less than ten percent (10%) of the project cost from private loans (bankers and other lenders) and owners’ contributions (equity). The minimum loan that may be applied for is $5,000.
     
     
     
     
    COSTS:
     
     
     
    The Borrower will be financially responsible for all loan costs associated with the completion of the loan transaction. Incurred costs will be deducted from the proceeds of the loan at the time of closing. Closing costs may include, but are not limited to, credit verification fees, UCC-I filing fees, the cost of establishing payment coupon books, attorneys fees, legal fees, filing fees, appraisal fees, and costs associated with codes enforcement inspections. An estimate of these costs will be provided to the applicant before loan commitment.
     
    REVOLVING LOAN FEE:
     
    A Revolving Loan Fee in a minimum amount equal to 2% of the amount of the loan is due and payable upon acceptance of the commitment letter. This fee is non-refundable.
     
    INTEREST RATE:
     
    All Loans will be negotiated at an interest rate to be recommended by the TB-RLF Committee at the time of the loan commitment. The rate determination will be based on several factors, to include start-up or existing business, management experience, term, collateral, personal guarantees, and use of proceeds, debt to income ratios, and debt to net worth ratios.
     
    LOAN TERM:
     
    The term of the loan shall be determined by the TB-RLF Committee, taking into consideration the purpose of the loan, the life expectancy of the assets financed, and the ability of the borrower to service the debt from cash flow or asset conversion.
     
    COLLATERAL:
     
    The TB-RLF Committee may seek reasonable and sufficient security for loans it makes and may for any reason deny access to funds based on its sole determination of the risks involved and the adequacy of the security available. Normally, the security required will take the form of second/third mortgages, liens on equipment, equipment, and fixtures, liens on accounts receivables and inventory, and personal assets and guarantees. In determining collateral requirements, the TB-RLF Committee will consider the merits and potential economic benefits of each request. Life insurance on key persons associated with the continuing success of the business may be required. A Personal Guarantee, as well as a Corporate Guarantee, may be required. Current appraisals, to support collateral values, may be required.