The Appalachian Loan Fund (ALF) is a locally controlled source of long term, fixed rate financing for existing businesses whose projects will result in the creation of permanent full time jobs, and leverage private sector investment. This program is partially capitalized by grants from the Appalachian Regional Commission, the State of South Carolina, and loans from US Department of Agriculture, and supplemented with funds from the Community Reinvestment Fund. These loans are available for small to medium size businesses in Anderson, Cherokee, Greenville, Oconee, Pickens, and Spartanburg Counties. This program is administered by the Appalachian Development Corporation, a private, non-profit corporation that complies as an equal opportunity lender.

Do the funds compete with Financial Institutions?

No. The funds will complement lending activities of commercial banks. These funds are designed to provide "gap financing" by filling the gap between what a financial institution will lend on a project and what the business can provide in equity. These funds will generally assume a subordinate position to the private lender.

What types of loans can be made?

These funds can be used to finance fixed assets such as land, building, machinery, equipment, real property improvements, etc. Working capital loans are also available. Refinancing of existing debt is not eligible.

What businesses are eligible?

The program funds can assist manufacturing, industrial, service, and some retail firms. Projects financed with fund dollars must create at least one job per $25,000 in funds loaned. At least 50 percent of the project cost must come from private lenders or sources. The business should contribute at least 10 percent of the project cost in equity.

The Advantages for the Primary Lender.

This program uses its own money to make and service loans. Other than a letter from the lender acknowledging the program participation, no other paperwork is required of the primary lender. Involvement by the Appalachian Development Corporation limits the risk of the primary lender. Use of the funds can lead to a lower blended interest rate for the borrower. The extended terms offered by the funds can improve the borrowers' cash flow improving the credit risk. Public funds involvement obtains Community Reinvestment Act credit.