James Kelly and Carmine Russo of Dependable Roofing are looking to secure a term loan in the amount of $33,100 from a local community lender in Kent county, Michigan. Both the owners have an excellent track record of working as independent roofing contractors in the target market and have been able to create excellent personal balance sheets and credit histories. Besides having the expertise in the industry, they will also be able to provide the lender with business and character referrals.

It is anticipated that the bank will approve the term loan for a 4 year period for an interest rate of 8.25% - the reason we are estimating a slightly higher rate of interest is because of the relatively riskier nature of work involved with roof contracting work. It is also anticipated that the bank may stipulate that the approval be subject to the firm carrying a certain amount of business liability insurance over and above the state mandated workmans compensation insurance for all employees and sub-contractors.

The owners are also aware that in the small business world, almost all business loans secured in the name of a company have to be backed by the personal guarantee of the business owners. These kinds of loans are called 'Full Recourse' loans and what that means if that the borrowers are personally and jointly liable for the outstanding principal and interest on the loan - if they were to default on their payments, the bank could go after their individual personal assets.

In the event the lender only approves part of the loan or denies the loan, James and Carmine are ready, willing and able to contribute the $33,100 needed directly from their personal savings.

Quick Links:

1. Go to the Corresponding Template section for this industry.
2. Go to the Corresponding Questionnaire section for this industry.