Contractor Lines of Credit

Overview

Detroit Development’s contractor lines of credit will provide financing for contractors that are related to a specific contract or purchase order.

Criteria, Loan Size and Terms

TO QUALIFY FOR A CONTRACTOR LINE OF CREDIT LOAN, PROJECTS SHOULD MEET ONE OR MORE OF THE FOLLOWING CRITERIA:

  • Similar to Small Business Loan program criteria
  • Have 1 to 2 years experience or have completed MSHDA Contractor Assistance Program, or similar program
  • Have contract or purchase order to perform work
  • Will use Detroit residents to complete portions of contract
  • Contractor lines of credit amounts usually range from $30,000 to $100,000
  • Draws on the line of credit will be used on work completed by the contractor; Contractor’s project will be monitored
  • The lines will generally have terms lengths of 6 to 12 months
  • The lines will generally be structured with interest only payments with principal recovery as the contractor receives payments

**Exceptions may be made to revenue and length of time in business criteria depending upon the specific project and the company paying the contractor for the service.

Use of Proceeds

CONTRACTOR LINES OF CREDIT PROCEEDS CAN BE USED FOR THE FOLLOWING:

  • Finance payroll through the accounts receivable collection period
  • Purchase materials
  • Cover operating expenses