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!


SBA 504 Loan

Is your business dream limited by the need for land, space or fixed equipment?

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

Dream it. Do it.

Start Here

For additional information on 504 loans, please click here for our 504 Loan FAQs. 


SBA 7(a) Community Loan

Do you need business capital to start or expand your business?

A Community Advantage loan is a Small Business Administration 7(a) loan that is financed by a mission-based lender, like SomerCor, rather than directly through a conventional lender or the SBA. We remain your point of contact for the life of the loan.

SBA 7(a) Community Advantage (CA) loans are used for working capital, debt refinance, tenant improvements, and significant purchases that are part of the day-to-day necessities of running your business. Funds can also be used to acquire a building and heavy equipment. Loans range from $50,000 to $250,000, a range that often falls in a financing gap between micro loans and the loan sizes that conventional lenders provide.

SomerCor is honored to have been selected by the SBA as Illinois Community Advantage Lender of the Year.


SBA 7(a) CA LOAN


ELIGIBLE USES

  • Long-term working capital
  • Expand or modernize facilities with leasehold improvements
  • Purchase equipment, inventory, furniture, and fixtures
  • Acquire, operate or expand an existing business
  • Buy, build or renovate commercial real estate
  • Refinance or consolidate debt (cash advances, high interest credit cards or factoring contracts)
  • Purchase commercial vehicles

BENEFITS TO YOU

  • Streamlined application process
  • Approval within 2-4 weeks
  • Provides loans where many conventional lenders will not
  • Seven-year term
  • Application fee is credited back at closing

REQUIREMENTS

  • For-profit business with fewer than 500 employees
  • Owner net worth of $15MM or less
  • Start-up or existing business
  • Located in Illinois
  • No existing debt obligations to the U.S. government

Dream it. Do it.

Start Here

For additional information on 7(a) Community Advantage loans, please click here for our Community Advantage Loan FAQs. 


Small Business Improvement Fund (SBIF) Grant

Are you located in a City of Chicago TIF district and want to renovate your building?

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.

Start Here

SBIF QUICK LINKS

SBIF Districts

SBIF Lottery

SBIF Eligibility

SBIF Helpful Links

SBIF Lenders

Am I in a SBIF District?

SBIF Application

SBIF Program Rules

Retail Thrive Zone SBIF Program Rules

Retail Thrive Zone SBIF Application

For additional information on SBIF grants, please click here for our SBIF Grant FAQs.


Neighborhood Opportunity Fund Grant

Are you located on a commercial corridor in the City of Chicago's South, Southwest or West Sides and want to renovate or build a commercial property?

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.

Start Here

NOF QUICK LINKS

NOF Program Overview

NOF RFQ for TA Providers

NOF Application


To learn more, including when the next grant application period is, visit the City of Chicago’s Neighborhood Opportunity Fund website.