IDS Corporation
8280 College Parkway
Suite 204
Fort Myers, FL 33919
Phone (239) 652-5588
Fax (239) 652-9988
admin@idscorp.org
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504
Program Benefits |
| Borrower
Benefits |
Low down payment for capital asset financing
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| Long-term fixed rate financing |
| No "balloon" payments or pricing
"calls" |
| Reimbursable closing costs |
| Turnkey project financing with broad cost
definitions |
| Collateral requirements are generally project
specific |
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| Lender
Benefits |
Lower credit risk profile, easier approvals
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| Ability to offer more aggressive pricing
& loan structures |
| Core asset holding or secondary market
opportunities |
| Leverage ROE & ROA performance measures |
| IDS handles SBA interface, approval &
reporting |
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| Both
the Borrower and Lender benefit from basically very straightforward
eligibility standards |
Borrower must be a for-profit operation
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| Average Net Income must average under $2,500,000
for the past two years |
| Borrower Net Worth cannot exceed $7,500,000 |
| Generally, debt refinancing is not allowed |
| Proceeds must be used for Capital Assets
and related allowed costs
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| Financing
Structure |
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The Borrower is required to
inject ten to twenty percent of the total allowed project
cost. This can be accomplished through actual cash injections
or acceptable assets such as land. The equity injection
requirement starts at ten percent and increases in five
percent increments, cumulatively, depending on if the
project involves single or special purpose construction
or whether or not the borrower is a start-up venture. |
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| Bank Financing |
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The bank makes an interim loan for the
balance of the project's costs. The pricing and structure
of this loan is negotiated entirely between the Borrower
and the Bank. Within thirty to sixty days of completion,
a SBA sponsored financing will provide a takeout, reducing
the bank's exposure to approximately 50% of the project
cost. The bank's permanent financing must have a term
of no less than ten years on real estate or seven years
for equipment. Amortization schedules are normally twenty
years on real estate and ten years for equipment. |
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| IDS Financing |
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IDS's financing is the takeout referred
to above. It is straight twenty year fully amortizing
financing. Pricing is set at the date of funding and is
fixed for the full twenty years of the loan term. The
chart below compares the interest rate with the Wall Street
Journal Prime Rate and the U.S. Ten Year Treasury Note. |
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UPDATE CHART
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