Johnson County
Small Business Support Center
305 West Main Street, Mountain City, Tennessee 37683
 Telephone: (423) 727-8559
FAX: (423) 727-7255
info@johnsoncountybusiness.com

Johnson County Small Business Support Center

Business Loans
Writing a Business Plan
Marketing Your Business
Business Resource Library
ETSU Economic Development Center
Support & Resource Links
Success In Business

Business Loan Underwriting Criteria

Loan Description

All loans will be collateralized. Collateral may be, but will not be limited to, furniture, fixtures, equipment, supplies, material, inventory, expansions, and other items related to the business.

  1. All loans are personal loans to be used for business purposes. The funds may be used for working capital, equipment, inventory, expansions, and other items related to the business.
  2. Loans will vary in size from a low of $500 to a maximum of $25,000 (initially the program will limit loan maximum to $10,000).
  3. All loans will be at a fixed rate and will have a maximum of seventy-two (72) month repayment.

Loan Process

  1. The borrower must submit a written business plan and attend a small business counseling session at the Economic Development Center (EDC).
  2. Applicant will be notified within three (3) business days of the Loan Review Committee's decision.
  3. Staff will make every effort possible to close an approved loan within thirty (30) working days of the loan approval. A 1% closing fee will be assessed at closing when using materials, equipment, etc., as collateral. A 2% closing fee will be assessed at closing when a Deed of Trust is involved.
  4. Requests to refinance a loan will be reviewed on a case-by-case basis. All requests will be subject to compliance with the underwriting criteria for CDCNET loans in effect at the time of the request.
  5. Refinancing existing CDCNET loans or funding of additional loans will be considered after a satisfactory repayment period of six (6) full principal and interest payments.
  6. Loan applicants whose loans are not approved may resubmit their applications within six (6) months.

Loan Applicant Qualifications

  1. No loans will be made to any applicant with a bankruptcy less than 18 months from discharge. Judgments, liens, and slow credit will be looked at on a case-by-case basis. Applicant will be required to produce a written explanation of credit problems
  2. Applicant must have a debt-to-income ration of 60% or less. Any applicant with a debt-to-income ration in excess of 60% automatically requires a co-borrower that will provide personal finance information. Applicants must inform staff of any changes that will occur in personal income if loan is approved.
  3. The principal business location must be within Johnson County.
  4. Borrower must be at least 18 years of age (or an emancipated minor).
  5. HUD income guidelines will be applied if Community Development Block Grant (CDBG) funds are to be used. All loans should result in the creation or retention of low to moderate income (LMI) jobs. Preference will be given to an application creating low to moderate income positions.