Asheville Reporter

A new lending program backed by various entities is forming to help businesses survive amidst the COVID-19 outbreak that has impacted the state and country. 

Mountain BizWorks is working with partners throughout the state to launch the NC COVID-19 Rapid Recovery Lending Program, according to a Blue Ridge Now report on March 24.

Golden LEAF Foundation is supporting the program with a $15-million contribution to N.C. Rural Economic Development Center, which is helping to head up the partnership of lenders. 

Mountain BizWorks wants interested owners to understand that — while funding might benefit many businesses struggling with the virus-induced lag in the economy — the loans are not meant to be relied upon solely for helping small businesses as the Recovery Lending Program is not a grant program. 

Businesses small and large have suffered financial losses as COVID-19 rapidly spread throughout the country. 

Businesses that obtain any amount up to the $50,000 maximum are expected to pay back the borrowed balance. Borrowers will have six months without any interest on their loan and zero payments to make, which may provide many companies some time to breathe. This period is followed by 48 months of principal and interest payments with a 5.5% interest rate. 

Businesses will not be penalized for paying off the balance early. Additionally, after six months, any remaining principal will be converted to a three-year note with a 7.5% interest rate. 

To qualify for the loan, individuals must have more than 20% ownership in the business they are applying for assistance with and must personally guarantee their commitment to repay the loan. 

Additional terms of the loan state that the money may only be used to maintain or restart a business. Businesses that began their operations before March 23 are eligible. 

More information about the loan is available on the Moutain BizWorks website.