Frequently Asked Questions

The California Rebuilding Fund is a loan program to support California’s small businesses, especially those located in economically disadvantaged and historically under-banked areas of the state. Businesses with 50 full time employees (FTEs) or fewer and gross revenues of less than $2.5 million in 2019 are eligible to apply. A description of the loan terms are in the Loan Terms tab. Full eligibility requirements are included in the Business Requirements tab.

The pre-application will open on Friday, November 20th at Noon Pacific Daylight Time.

Participating community lenders will begin reviewing pre-applications shortly thereafter, but due to high expected volumes, it may take a few weeks for you to be contacted by a community lender.

The fund is aimed at helping small businesses across every county and region of California and nearly all industries, particularly those located in economically disadvantaged and historically underserved areas.

To qualify, small businesses must have employed 50 or fewer full-time equivalent (FTE) employees prior to March 2020 and have realized gross revenues of less than $2.5 million in 2019, and must have suffered a direct economic hardship as a result of COVID-19.

Full eligibility requirements are in the Business Requirements tab.

If you have completed and submitted the online pre-application and are matched with a participating community lender, you will receive an email or call from the shortly so that you can begin the full loan application process.

Free local support can be found through a number of organizations.

• Venturize will allow you to find a free local small business resource center based on your zip code.
• CAMEO has a list of small business resources based on your region.
• Pacific Community Ventures offers a free business advising platform to help with your loan application and other specific needs
• The California Small Business Development Centers and the California Women Business Centers are also available to work with you one on one as you navigate this period of economic uncertainty and consider accessing a loan

Please see the Resources tab for full information.

The online pre-application should be completed and submitted by the owner of the business with the largest ownership interest.  Any owner with more than 20% ownership will also be required to attest to the information provided.

The California Rebuilding Fund knows that your funding needs are urgent. All applications are assessed on a case-by-case basis and the speed is dependent on the lender accessing the necessary documents to proceed. There is a target of 2-3 weeks from the date a complete loan application is filled with the community lender to funding the loan. 

The Connect2Capital pre-application is the first step to apply, but the platform doesn’t make credit decisions and should not be mistaken for a complete application with a lender. You will be invited to apply with your matched lender once you come up in their queue. Depending on loan volume this may take several weeks to be invited to apply. To facilitate a timely processing of your loan application, please prepare the required information and documentation in advance and make sure that all information and documentation are complete and accurate.

For help with the loan application and additional resources available to entrepreneurs please see the question “What if I need help completing my small business loan application?” above.

The maximum available loan amount is $100,000 or up to 100% of your business’ average monthly revenues for three months prior to the COVID pandemic outbreak (in 2019 or early 2020), whichever is less. The maximum loan amount available under this program is $100,000.

An example of how your maximum loan is calculated
To determine your business’s average monthly revenues for an estimate of potential loan size, the lender may use the following:

• September 2019 Revenues: $10,000
• October 2019 Revenues: $15,000
• November 2019 Revenues: $20,000

Based on the above-referenced example, the average revenues for the period is $15,000 so 3-months of average revenues would be $45,000. In this example, the maximum loan size would be $45,000.

Please note that the actual size of the loan for which you may be approved will be determined by the lender after review of your business’s documentation and financial information. The amount of the loan for which you are ultimately approved may be less than the amount indicated by the example above. If the average monthly revenues for your business for the 3-month period is greater than $100,000, the maximum loan size will be $100,000.

Please see the LOAN TERMS page

The current fixed annual interest rate for loans issued under the program will be 4.25%, with the exception of San Francisco based businesses who are eligible for 0% interest loans as a result of local City support. The interest rate will be fixed for the life of the loan.

If there is a change in the Wall Street Journal Prime Rate, the interest rate on loans offered under this program after such change may increase or decrease, but any change would not affect loans already approved. Any updates to the rate will be communicated through this website.

There are two different types of loans offered under this program: one with a 60-month repayment schedule, and the other with a 36-month repayment schedule. Your eligibility will depend on your financial qualifications, which will be determined by the lender.

60-Month Term Loans

The repayment details of loans offered with a 60-month repayment schedule include:

• For months 1 – 12: Interest-only payments; you will be making monthly payments only on the interest charged on the loan
• For months 13 – 60: Principal and interest payments; your monthly payments will include interest and principal based on a 48-month fully amortizing schedule

For example*:

* Example assumes a fixed interest rate of 4.25%. Simple interest will be charged on the loan. For months 1-12, monthly interest-only payments are required. For months 13-60; principal and interest monthly payments are required based on a straight-line amortization over 48 months and assuming full repayment at 60 months. Final payment may differ. Payments are estimates for illustrative purposes only.

36-Month Term Loans

The repayment details of loans offered with a 36-month repayment schedule include:

• For months 1 – 12: Interest-only payments; you will be making monthly payments only on the interest charged on the loan
• For months 13 – 36: Principal and interest payments; your monthly payments will include interest and principal based on a 24-month fully amortizing schedule

For example*:

* Example assumes a fixed interest rate of 4.25%. Simple interest will be charged on the loan. For months 1-12, monthly interest-only payments are required. For months 13-36, principal and interest monthly payments are required based on a straight-line amortization over 24 months and assuming full repayment at 36 months. Final payment may differ. Payments are estimates for illustrative purposes only.

Proceeds can be used for working capital, inventory, marketing, refitting for new social distancing guidelines, operating and emergency maintenance, property taxes, utilities, rent, supplies, and other appropriate business purposes.

The loan applicant will be required to detail the proposed use of loan proceeds when they apply.

Please see the BUSINESS REQUIREMENTS page

Businesses engaged in certain activities are not eligible. Participating community lenders are responsible for making their own credit decisions. Applications will be reviewed on a rolling basis and will be managed taking into consideration the program’s goals. It is recommended that applicants apply as soon as possible. Due to a limited amount of funding availability and the high volume of applications expected, it is anticipated that not all eligible applicants will be able to receive a loan. 

Yes. The main office or headquarters for your business must be in California to be eligible. The loan must be used to support only a business’s California operations.

Once matched, your community lender will request the submission of a full loan application, which will ask you to provide the following documentation:

• Most recently filed federal tax returns (business and personal), if available and required by the lender;
• Bank statements and/or internally generated financial statements or other proof of revenue (including year to date financial statements);
• Schedule of ownership (name, address, SSN, EIN, or ITIN, phone number, email, percentage ownership, photo ID for any owners with more than 20% ownership);
• Brief description of COVID-19 impacts on jobs and financial statements that show loss of revenue;
• Evidence of legal formation and licenses of business entity (e.g., articles of incorporation and bylaws, local business licenses); and
• Copy of lease agreement (if applicable)
• Other documentation required by the community lender at or after the time of the application

Please note: Additional documentation may be required by the community lender at or after the time of the application in order to approve or underwrite your loan.

Once these documents are received, the community lender will conduct any credit checks and finalize the application review process. If you need support accessing the required documentation, please contact 833-ASK-SBDC or loans@asksbdc.com or visit the Resources Tab.

Businesses that are NOT eligible include, but are not limited to:

• Firms engaged in activities that are prohibited by federal law or applicable law in the jurisdiction where the business is located or conducted
• Business engaged in speculative activities that develop profits from fluctuations in price rather than through the normal course of trade
• Facilities primarily used for gambling or to facilitate gambling
• Businesses or firms engaged primarily in lobbying activities
• Passive real estate investments

No specific collateral is required to be eligible (e.g., you do not need to have access to any specific real estate or equipment). Please note that this program requires a blanket first or second lien on business assets will be filed by the community lender and any owners with more than 20% ownership must sign a personal guarantee. 

The online loan process is highly secure. The platform goes above and beyond to protect your sensitive information. The platform uses TDE (Transparent Data Encryption) in SQL (Structured Query Language), which means the data is encrypted at rest. It also encrypts the data between the app server and the database and uses TLS (Transport Layer Security), which protects communications on the internet, for form submissions.  Your information will be used solely for the purposes of the loan program.  Among other things, this means that your information may be used in connection with a sale or transfer of your loan, other transactions involving the loan, related research and impact reporting.

Once the site is ready to receive applications, please click here. There are resources and organizations available to support you in getting ready to apply.

Loans will be made available through local Community Development Financial Institution (CDFI) lenders; currently there are twelve participating lenders, including:

• 3Core
• Access + Capital
• Accessity
• CDC Small Business Finance
• ICA
• Main Street Launch
• Fondo Adelante
• National Asian American Coalition
• Opportunity Fund
• PACE
• Pacific Community Ventures
• Working Solutions

Loans may include minimal third-party fees up to a maximum of $250 such as UCC filing fees or wiring fees, for example.

Please note that a late fee may be assessed by the lender if the borrower does not make a loan payment on time. You will be shown any fees associated with the loan prior to your acceptance of any loan terms.

If each business is a separate legal entity, has a separate tax ID and all affiliated businesses combined employed 50 or fewer full-time equivalent (FTE) employees prior to March 2020, then you can apply for each of the businesses.  Each business must meet all eligibility requirements.

Yes, you can apply to another participating community lender if you match with multiple participating lenders.  HOWEVER, please be aware that the approval parameters for the participating lenders are largely identical.  Moreover, we ask that you do not apply to a second community lender unless your loan has been rejected by the first lender. 

No.

NO, THIS IS NOT A FORGIVABLE LOAN.  The borrower will need to pay back the full amount of the loan with interest over a 3- or 5-year term. Please see the Loan Terms for the full set of terms.

If you do not make a loan payment on time, you may be assessed a late fee by the participating lender per their respective policies.  A failure to pay also can result in the loan being declared in default and the lender’s exercise of its default remedies under the loan documents. Please review the full terms of your loan agreement for additional details regarding default.