The North Central Massachusetts Development Corporation

Business Financing Programs

For over 20 years The North Central Massachusetts Development Corporation (NCMDC) has been providing financing to local businesses throughout the region. Representing the 26 communities of the region as well as the five chambers of commerce, the NCMDC is pleased to offer local business owners and entrepreneurs access to a variety of non-traditional business loan programs. The NCMDC employs a lending and finance specialist, Mr. Bruce Larsen, Vice President of Lending (978) 353-7600 ext. 232 who is an experienced and highly respected business and banking advisor. For more information about your financing needs and options, please contact Bruce by phone or email at larsen@massweb.org.

What Can Be Financed With a Development Corporation Loan?

• Real Estate New Construction
• Facility Upgrades and/or Expansions
• Leasehold Improvements
• Real Estate Refinancing
• Acquisition of New and/or Used Equipment

Revolving Loan Program

The North Central Massachusetts Development Corporation (NCMDC) administers a revolving loan pool funded by grants through the federal (EDA) and state (CDBG) governments. The revolving loan program is designed to be an alternative loan source for both start-up and existing businesses. The premise of this program is to approve loans that were not qualified to gain approval through traditional bank sources. NCMDC is often the sole lender in the loan. But, in many cases NCMDC has enhanced the loan by providing tier financing or a participation with another financing institution in the credit.

To be eligible for the revolving loan program, a company must meet the following criteria:

• For-profit corporation, partnership or proprietorship
• Must be located in North Central Massachusetts
• Tangible net worth not in excess of $6-million
• Less than $2-million average net profit after taxes during previous two years

Community Reinvestment Fund

In 2002, NCMDC signed a contract with Community Reinvestment Fund (CRF) to offer a lending program that would complement its other programs. Structured in a similar manner to the SBA 504 Loan Program, this enabled NCMDC to take part in larger credits in participation with local financing institutions. It also was much less restrictive than the SBA product in that non-owner-occupied real estate and debt restructuring are allowable.

How it Works:

A Community Reinvestment Loan is a three-way partnership, involving a Lender of your choice, the Development Corporation and you the Borrower. The typical structure provides for a maximum of 40% financing by the Development Corporation. The Lender finances 50% while the Borrower provides 10%. The Lender portion is financed at conventional rates and terms but takes a first position on the assets acquired. Once the loan request is approved, the Development Corporation issues a commitment letter that will outline the terms under which the loan will be made. When these terms have been accepted, the Development Corporation will work with your Lender to close the loan. The loan will be serviced by the Community Reinvestment Corporation of Minneapolis, Minnesota.

U. S. Department of Agriculture

NCMDC has also established a relationship with the lending arm of the U.S. Department of Agriculture (USDA). Loans through USDA directly or in concert with one of NCMDC’s loan products also enable the Development Corporation to become involved in larger or more difficult credits.

Loan Guaranty Program

Another of NCMDC’s loan enhancement products is the Loan Guaranty Program. Under this program, the financial institution makes the loan. NCMDC provides a guaranty of up to 75% of the loan up to $50,000. The guaranty is for the first two years of the loan. A fee is paid to NCMDC of 2% of the guaranteed amount for the first year and 1% for the second.

Traditional Sources of Loan Financing

Development Corporation staff is also available to help you locate traditional business loan sources to finance your business venture or expansion project. Please call at (978) 353-7600 ext. 232 or send an email to Larsen@massweb.org.

FREE Counseling

Most times, it is advisable for a local business owner who may be considering applying for loan financing to have their business plan or entrepreneurial concept reviewed by an expert. Fortunately, the Development Corporation has a special partnership to provide FREE business counseling on Tuesdays and Thursdays through the Small Business Development Center (SBDC) and/or the Service Corps of Retired Executives (SCORE).

Mike Holbrook SBDC Counselor (978) 353-7600, ext. 221 "I am always pleased to meet and talk with business owners and entrepreneurs about their ideas, plans, and challenges."

The North Central Massachusetts Development Corporation offers business counseling services through the Massachusetts Small Business Development Centers (SBDCs) and SCORE (Service Corps of Retired Executives). Both agencies provide one to one management and technical assistance counseling for prospective and existing small businesses. 

Counselors are available on Tuesday and Thursday at the North Central Massachusetts Chamber of Commerce office at 860 South St. Fitchburg, MA  To access this service just call (978) 353-7600 and book an appointment. 

Prior to meeting with a business counselor you may want to ask yourself the following questions:

• Has your idea been thoroughly thought out?
• Is your product or service needed in the marketplace?
• Where are you going to locate your business?
• Do you know who your customers will be?
• How much money will you need to get started?
• Do you have money to put in to start up this business?
• Have you begun to develop a business plan?
• If you are purchasing an existing business also ask the following:
• Have you asked why the business is selling?
• Have you seen the financial statements (3 years) on this business?
• Have you inspected the inventory and/or real estate?