New York Codes, Rules and Regulations
Title 21 - Miscellaneous
Chapter L - New York State Urban Development Corporation
Part 4210 - Small- And Medium-sized Business Assistance Program
Section 4210.5 - Business terms

Universal Citation: 21 NY Comp Codes Rules and Regs ยง 4210.5

Current through Register Vol. 46, No. 12, March 20, 2024

(a) Project loans will not be made for less than $75,000. Within statutory limitations, terms and security arrangements will be flexible, depending on the type of loan and the particular characteristics of a project. Project loans that are secured by fixed assets will be preferred.

(b) Written commitments from other funding sources necessary for completion of the project generally will be required before approval of the project loan by the directors of the corporation, and in any event before disbursement by the corporation of the project loan. Approved construction loans will not be funded before secure commitments for permanent financing have been obtained.

(c) Interest rates on project loan will be set at the time the corporation's directors approve an application. Rates and terms will reflect market conditions, the applicant's ability to repay and project requirements. No loan shall bear interest at less than three percent. Interest rates may be increased during the term of the loan if the applicant fails to create and/or retain specified employment levels approved by the corporation.

(d) For certain project loans, an additional return to the corporation may be required, based on the borrower's projected performance.

(e) Project loans will be made for the following terms:

(1) Except as provided in paragraph (5) of this subdivision, loans for which the proceeds are used to acquire or improve real property generally will be made for a term not to exceed 30 years. In a coequal and coordinate mortgage situation, a UDC mortgage will match the term of the other mortgagee.

(2) Loans for which the proceeds are used to acquire machinery and equipment generally will be made for a term of from three to seven years or the useful life of the collateral, whichever is less.

(3) Construction loans will not exceed 24 months.

(4) Working capital loans will be made for one to four years.

(5) No child-care facility assistance project loan shall be made for a term exceeding 10 years, regardless of the form of collateral securing the loan.

(f) Standard repayment terms will generally include level debt service payments over the term of the project loan. In certain circumstances, deferred or graduated payments may be permitted.

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