Brooklyn EDC offering emergency loans for dislocated firms

Real Estate Weekly, Oct 10, 2001

Brooklyn Economic Development Corp. has created two short-term emergency loan funds to assist businesses hurt by the World Trade Center tragedy.

Businesses in all five boroughs of New York City are eligible to apply for up to $5,000 from the Regional Economic Development Assistance Corp. disaster relief business loan program.

No payments on the loan are required for two months. For qualified applicants, funding can be available within five days of filing the application. The one-year term loans feature a 9.75% interest rate and must be used for business-related expenses, such as physical reconstruction, payroll, inventory replacement, relocation costs, or equipment replacement.

"The REDAC disaster relief business loan program was created for small businesses in lower Manhattan and other businesses in the five boroughs affected by the World Trade Center disaster that may not have a banking relationship," said Joan Bartolomeo, president of BEDC. "This program will pull them through this difficult time so that they can make payroll, replace inventory, and have enough working capital to get people back to work while they are applying for a bank loan or SBA loan or waiting for an insurance claim."

"We don't see this as the answer to the problem, but part of a larger array of services that will be required to help retain the vitality of New York City's small businesses," she continued.

BEDC is also offering a one-year revolving line of credit of up to $10,000 for Brooklyn businesses or businesses owned by Brooklyn residents. The line of credit must be used for business-related expenses and can help with cash flow issues created by the loss of business and increased receivables.

Borrowers for both loan programs will be evaluated on their personal credit history and their current debt and documented personal income will be reviewed. Personal guarantees will be required.

No financing points or application fees are necessary and there are no prepayment penalties.