The BDC’s Commercial Loan Program is part of a concentrated effort to benefit the community of Berwyn by stimulating business growth and improving the city's commercial areas. The BDC coordinates the program in conjunction with the City of Berwyn. The Program is capitalized by monies committed by the City and lines of credit extended by participating financial institutions and guaranteed by the City. The Program provides an incentive to existing commercial property owners and business tenants to renovate their establishments and/or expand their Berwyn operations. In addition, the Program encourages credit-worthy businesses to relocate or expand into Berwyn. The Program is not intended to compete with banks, but rather to act as an additional resource for businesses that need capital. When combined with loans from conventional sources, these program funds produce a blended below market rate financial package. Since public funds capitalize this program, the City’s participation in a project is contingent upon the project’s compatibility with the City’s economic development goals, procedures and guidelines.

Loan Types

The BDC makes loans to businesses operating in the City through several loan types, which are summarized as follows:

• Startup Loans – loans to businesses in operation less than three years. The purposes of these loans are to encourage entrepreneurship, support new business and foster business mix diversity.
• “Up and Comer” Loans – loans to businesses in operation a minimum of three years. The purposes of these loans are job creation, property redevelopment, increased sales tax generation, and expansion/modernization.
• Cornerstone Loans – loans to businesses in operation a minimum of ten years. The purposes of these loans are job creation, property redevelopment and increased sales tax generation.

Specific requirements for each loan type are contained in the Loan Parameters.

Procedure

The BDC and the City require program applicants to supply the BDC with a completed loan application and a nonrefundable application fee of two hundred and fifty dollars ($250). The BDC reviews each application on a first-come, first-served basis on its own merits without prejudice with respect to age, disability, sex, marital status, race, color, national origin, religion, sexual orientation, receipt of public assistance, or borrower’s good faith exercise of rights under the Consumer Credit Protection Act. BDC may extend credit if the borrower provides the following:

1. Clearly identifies a primary source of repayment
2. Provides alternate avenues from which BDC may derive repayment
3. Provides sufficient financial information to justify the extension of credit
4. Agrees to a clearly defined repayment schedule specified at the outset

The BDC’s Commercial Loan Committee, composed of representatives of participating lending institutions, the President of its Board of Directors, and its Executive Director, reviews the application and issues a recommendation for either approval or denial to the Board of Directors. The Board of Directors then reviews this recommendation and, if it approves the application, forwards its recommended terms and conditions to the Berwyn City Council for final action. The BDC provides notification to the applicant whereupon he/she may enter into formal contracts for the relocation, expansion, and/or other renovation work.

Program Guidelines

The following guidelines apply to all program loans:

• If the program applicant is an owner, he/she must have a propriety interest in the subject property for at least the length of the loan as approved. In the event of a change in ownership, legal or equitable, of the subject property, the entire indebtedness shall, at the option of the holder, become immediately due and payable.
• If the program applicant is a lessee, the length of the lease must be at least the length of the loan as approved.
• The City, the BDC and/or the lead lender reserve the right to seek all necessary information from or about the program applicant, including credit references.
• The program applicant may secure the loan by a real estate mortgage, preferably a first lien, not to exceed fifteen (15) years or provide other collateral or security acceptable to the lender(s).
• Program applicants must assume personal liability.
• Program applicants are responsible for any and all costs incurred prior to notification of final loan status should their loan application be denied.
• The minimum amount of project work must exceed $5,000.
• Project work must correct all code violations and conform to the provisions of the Americans with Disabilities Act (ADA).
• Program participants must allow the City to make permit and work progress inspections as is its legal right and obligation.
• Program participants must become and remain BDC members in good standing for the life of the loan.
• Upon maturity, balloon startup loans may be refinanced as Up and Comer Loans.
• Written approval of the building owner is required for all loan-sponsored leasehold improvements.

Please click here for Commercial Loan Application

Participating financial institutions