Program Benefits
Loan Structure

IDS Corporation
8280 College Parkway
Suite 204
Fort Myers, FL 33919

Phone (239) 652-5588
Fax (239) 652-9988

504 Program Benefits
Borrower Benefits

Low down payment for capital asset financing

Long-term fixed rate financing
No "balloon" payments or pricing "calls"
Reimbursable closing costs
Turnkey project financing with broad cost definitions
Collateral requirements are generally project specific
Lender Benefits

Lower credit risk profile, easier approvals

Ability to offer more aggressive pricing & loan structures
Core asset holding or secondary market opportunities
Leverage ROE & ROA performance measures
IDS handles SBA interface, approval & reporting
Both the Borrower and Lender benefit from basically very straightforward eligibility standards

Borrower must be a for-profit operation

Average Net Income must average under $2,500,000 for the past two years
Borrower Net Worth cannot exceed $7,500,000
Generally, debt refinancing is not allowed

Proceeds must be used for Capital Assets and related allowed costs

Financing Structure

Borrower Equity

  The Borrower is required to inject ten to twenty percent of the total allowed project cost. This can be accomplished through actual cash injections or acceptable assets such as land. The equity injection requirement starts at ten percent and increases in five percent increments, cumulatively, depending on if the project involves single or special purpose construction or whether or not the borrower is a start-up venture.

Bank Financing
  The bank makes an interim loan for the balance of the project's costs. The pricing and structure of this loan is negotiated entirely between the Borrower and the Bank. Within thirty to sixty days of completion, a SBA sponsored financing will provide a takeout, reducing the bank's exposure to approximately 50% of the project cost. The bank's permanent financing must have a term of no less than ten years on real estate or seven years for equipment. Amortization schedules are normally twenty years on real estate and ten years for equipment.

IDS Financing
  IDS's financing is the takeout referred to above. It is straight twenty year fully amortizing financing. Pricing is set at the date of funding and is fixed for the full twenty years of the loan term. The chart below compares the interest rate with the Wall Street Journal Prime Rate and the U.S. Ten Year Treasury Note.





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