California Loan Guarantee Program

California’s Small Business Loan Guarantee Program was designed by the State of California to assist small business and farming enterprises that need additional collateral in the form of a Guarantee to induce a Lender to finance loans that are otherwise undercapitalized.

The Small Business Loan Guarantee Program (through the Business, Transportation and Housing Agency), has given SAFE-BIDCO the chance to work with local lenders to provide guarantees for a wide range of business loans and lines of credit. These guarantees can be helpful for firms experiencing rapid growth of seasonal cash shortages.

The program is user friendly and allows banks to use their own application forms and credit memorandums to submit for state guarantee approval.

Note: Repayment is considered prime criteria in granting Loan Guarantees. The borrower must demonstrate the ability to repay the loan.

Acceptable uses of the Guarantee:

  • Revolving LOC
  • Term Loans for asset purchases
  • Purchases of existing businesses
  • Establishing a new business
  • Refinancing existing business debt

Guarantee Terms:

  • $2.5 million maximum Guarantee exposure
  • Up to 80% (maximum) Guarantee
  • 7 year maximum on term loans
  • 1 year on revolving LOCs (Renewable 2 years)
  • Quarterly reporting

Guarantee Fees:

  • 2% Guarantee fee for loans/LOCs
  • 1% guarantee renewal fee on LOCs
  • Documentation Fee: $250


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