How to Navigate Your Small Business Funding Options
We’re here to help you. Take a look at the information below, as we spell out the basics on our loan programs as well as the grant programs that we administer. Each section clearly describes the overall purpose for each program, the eligible uses of funds, the requirements, the benefits, and the types of businesses and/or locations that qualify.
Once you’ve gone through this, fill out the Start Here inquiry form and we’ll take it from there. If you have questions or need help right away, just call or email one of the loan officers on our Contact Page. We look forward to helping you get started. And getting it done!
Whether you are starting a business from the ground up or improving on what you already have, Small Business Administration (SBA) 504 loans can be ideal to help you grow your business. These loans are a cooperation between the SBA, a commercial lender and you. You benefit because the program allows for less capital investment, with loan financing or refinancing at lower, long-term, fixed rates.
SomerCor helps you obtain the SBA 504 loan which provides financing or refinancing for up to $5.5 million of your overall loan, no matter the scope of the project—as much as 90% of the total project cost (see pie charts below).
SBA 504 LOAN
ELIGIBLE USES
- Purchase commercial real estate
- Build or renovate commercial property
- Buy equipment, machinery and fixtures
- Refinance debt for commercial property and equipment
- Pay eligible soft costs and professional fees
BENEFITS TO YOU
- Lower down payment
- Up to 90% financing
- Long-term, below-market fixed interest rates
- Potential cash-out refi
- Predictable monthly payments
- No balloon payments
REQUIREMENTS
- Owner-occupied commercial real estate in Illinois
- At least 51% applicant occupancy (60% for new construction)
- For-profit business
- Under $15 million in tangible net worth
- Prior 2 years average after-tax net income under $5 million
- Able to meet the down-payment requirement (see below)
- Good personal credit history
TYPES OF BUSINESSES
- Manufacturing, industrial and commercial
- Hotels, gas stations and storage facilities
- Business and medical office buildings
- Most franchises
EXAMPLES OF HOW AN SBA 504 LOAN WORKS
Business in mixed or single-use building
New business or single-use building
New business in single-use building
For additional information on 504 loans, please click here for our 504 Loan FAQs.
Dream it. Do it.
The City of Chicago’s Small Business Improvement Fund (SBIF) promotes economic development by providing small businesses with financial assistance for building-improvement costs.
SBIF grants use local Tax Increment Financing (TIF) revenue to reimburse you for the pre-approved repair or rehab of your business facilities or adjacent land acquisition. You must be located within a specific TIF district.
The maximum grant assistance for an industrial property is $150K; for a single-tenant commercial property the maximum is $100K; and for multi-tenant commercial property, it is $50K.
Grant funds are provided after an approved project is complete and all expenses are paid.
SBIF GRANT
REIMBURSABLE EXPENSES
- Permanent exterior improvements and storefront renovation
- Building systems improvements
- Tuck-pointing and masonry repairs
- Structural components of new signage
- Interior remodeling including ADA-compliance improvements
- Environmental remediation
- Purchase of adjacent property for business expansion or parking
BENEFITS TO YOU
- Receive reimbursement grants for up to 75% of your pre-approved project cost
- Grants do not have to be repaid
- Projects can be completed in up to three phases within 300 days
- Grant approval can be used to secure conventional loan for your project
- Funds can be used to repay the loan
REQUIREMENTS FOR ELIGIBLE BUSINESSES
• Valid city business license and current with property taxes
• Applicants must be clear of City indebtedness
TYPES OF BUSINESSES
Commercial tenants
Average gross sales under $5 million annually for the prior three (3) years
Owner-occupied
Maximum personal net worth of $6 million and maximum total liquidity of $500,000
Industrial
Maximum of 100 full-time equivalent employees
Vacant property
Minimum of 60% leased and 100% ground floor leased
INELIGIBLE BUSINESSES
Taverns, massage parlors, national chains, franchises and places of worship.
Dream it. Do it.
SBIF QUICK LINKS
For additional information on SBIF grants, please click here for our SBIF Grant FAQs.
The City of Chicago’s Neighborhood Opportunity Fund (NOF) was created by Mayor Rahm Emanuel to strengthen commercial corridors on Chicago’s South, Southwest and West Sides.
The NOF generates revenue from new developments in and around Chicago’s Loop, to finance commercial and cultural projects in neighborhoods that lack sufficient private investment. Grants can be up to $250K (larger projects need City Council approval).
Eligible applicants must be a business owner, property owner or other entity engaged in the sale of commercial goods and services or provision of cultural experiences. Projects may be awarded funds by the City of Chicago’s Department of Planning and Development if they demonstrate that they will have a catalytic impact on a neighborhood commercial corridor.
Learn more about the City of Chicago’s Neighborhood Opportunity Fund here.
NOF GRANT
ELIGIBLE USES
- Permanent exterior improvements such as façade, storefront and roofing repairs
- Interior remodeling including mechanical systems repairs
- Land and building purchase
- New construction
- Professional fees including architectural services
REQUIREMENTS
- Located on an Eligible Commercial Corridor or Priority Investment Corridor
- Commercial businesses like grocery stores, restaurants and retail
- Cultural projects such as theaters, music venues and art galleries
- Applicants must be clear of city indebtedness
BENEFITS
- Grants can be provided through escrow during project rather than as reimbursement
- For new building construction, grants can be up to 30% of total eligible project cost
- For building rehab, grants can be up to 50% of total project cost
- Applicants with primary residence in NOF Qualified Investment Area earn the Build Community Wealth Bonus, increasing grant percentage by 15%
Dream it. Do it.
To learn more, including when the next grant application period is, visit the City of Chicago’s Neighborhood Opportunity Fund website.