The New York Forward Loan Fund is an economic recovery program that administers affordable, non-forgivable working capital loans of up to $100,000, to businesses located in New York State that have suffered a direct economic hardship as a result of COVID-19. The loans are designed to help small businesses, nonprofits and small residential landlords that have difficulty accessing capital and that were not able to receive loans greater than $50,000 from the Paycheck Protection Program (PPP) or Economic Injury Disaster Loan (EIDL) programs administered by the U.S. Small Business Administration.
Who is eligible?
Eligible businesses must be located in New York State, have been in business for at least one year, and have suffered a direct economic hardship as a result of COVID-19. Other additional requirements by entity category are as follows:
Small Businesses
- Twenty or fewer full-time equivalent employees.
- Gross revenues of less than $3 million per year.
- Must not have received a PPP loan of greater than $50,000 or EIDL for any amount except advance grants up to $10,000.
Nonprofits
- Must be a 501(c) (3) organization providing direct services to New Yorkers such as daycare, senior services, educational programs, hunger relief, etc.
- Twenty or fewer full-time equivalent employees.
- Annual operating budget of less than $3 million per year.
- Must not have received a PPP loan of greater than $50,000 or EIDL for any amount except advance grants up to $10,000.
Small Residential Landlords
- No more than 200 units under ownership and no single property with greater than 50 units.
- Must be located in low or moderate income areas.
- Properties must have had positive cash flow for 12 months prior to the NY Forward Loan request and be current on property taxes through March 2020.
Examples of businesses currently ineligible for a loan are corporate-owned franchises, liquor stores, night clubs, and marijuana dispensaries. Owners of more than one small business and/or small residential landlords can apply for loans for each business, provided that each is a separate legal entity, has a separate tax ID number, and employs 20 or fewer full-time or full-time equivalent employees.
Proceeds are required to be used for working capital, inventory, property taxes, rent, utilities, marketing, re-fitting for social distancing, or similar expenses.
How much can be borrowed
For Small Businesses and Nonprofits
The lesser of (a) $100,000 or (b) up to 100% of average monthly revenues in any 3-month period from 2019 or first quarter of 2020.
For Small Residential Landlords
The lesser of (a) $100,000 or (b) projected reduction in six months of net operating income based on actual reductions for the month of April or May 2020.
Terms of Loans
Up to $100,000 loans are available and payable over a 5-year period, with monthly, interest-only payments for the first 12 months and interest and principal payments for months 13 to 60. The interest rate for small businesses and residential landlords is fixed at 3%, and for nonprofits at 2%. There are no application fees, no collateral required, and no prepayment penalty if the loan is paid off before maturity. The funds must be used for working capital and not used to repay other loans. Late fees are imposed on missed payments.
Application process
An online application process, several resources for assistance, and FAQs are available at the New York Forward Loan Fund website.
A community development financial institution will contact the loan applicant to collect all required documentation and conduct credit checks. The Fund suggests assembling the required information in advance, to accelerate the processing of the loan. Approved loans will be distributed through participating lenders. If a loan is denied, the Fund suggests not to apply to a different lender as a denial by one lender is considered decline by all lenders.
