The CDC Small Business Finance is a not-for-profit organization with headquarters in San Diego, California, which offers financing solutions to small businesses. Since it was founded in 1978 by Arthur H. Goodman, the company has provided over $4 billion in loans (as of August 2015) to small businesses, with a special emphasis on businesses owned by women, members of minorities and veterans.
Business owners must first choose the type of loan they need. CDC Small Business Finance offers loans to purchase equipment, real estate, working capital and tenant improvements. They then must complete an online form that requests personal and business information to ensure you meet CDC Small Business Finance's eligibility guidelines. The form takes approximately five minutes to complete. Within one business day a loan expert will contact you and explain what options you have available.
Interest rates are mostly set by the Small Business Administration. As of December 2014, the rates for SBA-504 loans, which are used for real estate and large equipment purchases are 7.6% and 6.6% for a 20- and a 10-year term, respectively. This includes the fees paid to the CDC and the SBA. The rate for SBA 7(a) loans, which can be used for working capital, real estate, business acquisition and mixed use, fluctuates based on the current LIBOR rate.
The SBA-7(a) loans range from $50,000 to $5 million. SBA-504 loans range from $125,000 to $20 million.
The CDC Small Business Finance operates in California, Arizona and Nevada.
The application process involves a short online application to determine eligibility. Once a business is pre-approved a loan expert will call within the next business day to obtain further information. It generally takes a month to get a reply and another month until the money is finally deposited.
CDC Small Business Finance has preferred lender status, which allows it to approve loans without consulting with the SBA. The CDC has an excellent track record as a small business lender. From 1978 to 2013, CDC Small Business Finance provided $12.3 billion in capital to small businesses, which created 131,000 jobs. In 2013 alone, CDC provided $914 million in loans to 470 small businesses; and 34 percent of these loans were to women, minorities and veteran-owned businesses.