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Many of CCLF's customers often ask the same questions about our
loan application process:
Should I fill out a CCLF loan application now?
Why is there a phone screening first?
Why is the application so long and detailed?
If CCLF takes risks, why must all loans be repaid,
with interest?
Will mediocre or bad credit keep my organization from
getting financing?
How important is my organization's business plan?
If the CCLF Loan Committee says "no," does that mean the process is over?
If my organization is pursuing other financing options,
will that hurt our chances at CCLF?
If circumstances change, may we come back to CCLF for
financing?
What if, later on in my development project, my financing
needs change?
We hope these answers give you a better sense of who we are and
how our loan program works.
I've gotten information
from this website and my organization is ready to go. Should I fill
out a CCLF loan application now?
No. Before submitting an application, you must always discuss your
project with the fund's lending
team. Feel free to call 312.252.0440, ext. 208.
Why is there a phone screening
first?
A phone screening will help you to avoid spending a lot of time
filling out the application if the project does not meet CCLF's
criteria; or enable you to get valuable feedback about your chances
for receiving financing and what the next steps should be. For example,
our lending team might suggest that members of your organization
attend our Project Readiness Workshop
before applying for a loan. Or sometimes when timing is critical
and eligibility is clear, you may be asked to submit the entire
application immediately.
Why is the application so
long and detailed?
Financing real estate development projects or commercial enterprises
is an extremely complicated process, fraught with risk. A credit
decision cannot be made reasonably without detailed information
about the project, including the applicant's management and financial
capabilities. All our loans are rigorously underwritten: all information
on the applications is double-checked, all assumptions tested. This
is not a matter of distrust; it is simply standard (sound and responsible)
lending procedure.
If CCLF takes risks, why
must all loans be repaid with interest?
We have responsibilities to our investors:
we promise that we will work to protect the money so that it will come
back to be re-lent to another borrower. We rely on the interest
"spread" to help pay operating costs, that is, to keep our doors
open. We have many repeat borrowers and we want to be around when
your organization needs additional financing! Plus, it helps your
organization build a credit history that, if you make payments on
time, will aid you in getting future credit--either from CCLF or
another financial institution.
Will mediocre or bad credit
keep us from getting financing?
Not necessarily. This is information that the loan officer will
need in order to evaluate the application. Our lending team may
ask you to explain what happened and demonstrate that those factors
have been remedied. Please do not try to hide "problematic" information:
CCLF does not have automatic "deal-killers." Misleading information
will only hamper our lending team's ability to help your organization
succeed.
How important is my organization's
business plan?
Never underestimate the power of a solid and thorough business
plan. CCLF has approved loans to brand new organizations, based
largely on their stellar business plans, as well as the integrity
and energy of the key staff and/or board members.
If the CCLF Loan
Committee says "no," does that mean the process is over?
Certainly not. Usually the committee will specify changes or additional requirements
that may make them comfortable enough to approve the project at
a later meeting. Our lending staff will be direct, respectful and
honest about the outcome of the loan committee process, and will
happily discuss next steps.
If my organization is pursuing
other financing options, will that hurt our chances at CCLF?
No. It is useful information for the lending team to have. And
if you can get a more favorable deal somewhere else, by all means,
go ahead. CCLF is also open to co-lending with other CDFIs and banks if
that works better for your organization.
If my organization goes
elsewhere, may we come back to CCLF if circumstances change?
Of course. We will be happy to "jumpstart" an old application process.
Just give us a call.
What if, later on in my
development project, my financing needs change?
CCLF's capital is acrobatic, meaning that it can transform into
a different kind of loan, even after the closing. Loans can "morph"
from a predevelopment into a construction credit or a minipermanent
mortgage, or from a short-term to a long-term loan, if need be,
as circumstances change. This feature is not automatic, however,
and must be negotiated on a case-by-case basis.
Have questions? Feel free to email
the lending team or call 312.252.0440 ext. 203.
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WHAT'S NEW
Do you have a question about the development
process? About developing a realistic development budget? Need a
referral?
Contact our online help desk
with your questions. A staff member will respond within two business
days.
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