Tamara Gurney
President and CEO of Mission Valley Bank
Part 2 of a 2-part series
This year brought business owners and nonprofits challenging obstacles of enormous proportions. Every organization experienced the pandemic in ways that were distinct to them and specific to their situation.
In the early days of the pandemic, emergency financing options — including the Paycheck Protection Program (PPP) — were made available to help organizations manage day-to-day expenses. But not all available lending is rescue financing.
The Federal Reserve Main Street Lending Program is designed to help credit flow to small and medium-sized for-profit businesses and nonprofit organizations — such as educational institutions, hospitals, and social service organizations — that were in sound financial condition before the onset of the crisis, but now need loans to help maintain their operations until they have recovered from, or adapted to, the impacts of the pandemic. (For profit businesses were discussed in the Oct. 2020 issue.)
It is important to note that Main Street loans are not grants and cannot be forgiven. However, borrowers that received a PPP Loan can also receive a Main Street Loan provided they are an eligible borrower.
The Main Street nonprofit loan terms generally mirror those of for-profit business loans, including the interest rate, principal and interest payment deferral, five-year term, and minimum and maximum loan sizes. Nonprofits are eligible for two loan options: the Main Street Nonprofit New Loans (maximum loan size is lesser of $35 million or the borrower’s average 2019 quarterly revenue) and Main Street Nonprofit Expanded Loans (maximum loan size is lesser of $300 million or the borrower’s average 2019 quarterly revenue). The nonprofit must have been in operation for at least five years and have a minimum number of 10 employees. Other eligibility criteria apply.
To get started, potential borrowers should review the program and contact their current financial institution. As a sidenote, there is tremendous value in working with a client-focused, relationship-driven banker who will invest the time necessary to get to know a client and understand their unique needs. The path to long-term success is developing long-term relationships with bankers who demonstrate expertise, experience, and dedication to their clients’ success.
Mission Valley Bank is a locally-owned, full service, independent community business bank headquartered in Sun Valley, California with a business banking office in Santa Clarita. They have SBA Preferred Lender status and are participating as an eligible lender accepting new customers from Southern California in the Main Street Lending Program. For more information visit www.MissionValleyBank.com or call (818) 394-2300.
