What is a Certified Development Company? A Comprehensive Legal Overview

Definition & Meaning

A Certified Development Company (CDC) is a non-profit organization that has received certification from the U.S. Small Business Administration (SBA). Its primary role is to facilitate financing for small businesses through the Certified Development Company Economic Development Loan Program. CDCs combine resources from the SBA, banks, state governments, and private investors to create financial assistance packages aimed at supporting capital improvements for existing businesses.

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Real-world examples

Here are a couple of examples of abatement:

Example 1: A small manufacturing company seeks funding for new equipment. They approach a Certified Development Company, which helps them secure a loan by combining SBA funds with a bank loan and state grants.

Example 2: A local restaurant wants to expand its space. A CDC assists them in obtaining financing through a mix of private investment and SBA-backed loans (hypothetical example).

State-by-state differences

Examples of state differences (not exhaustive):

State CDC Programs
California Offers additional state-funded programs alongside SBA loans.
Texas Has specific incentives for technology startups through CDCs.
New York Provides enhanced support for minority-owned businesses via CDCs.

This is not a complete list. State laws vary, and users should consult local rules for specific guidance.

Comparison with related terms

Term Definition Difference
Small Business Administration (SBA) A federal agency that provides support to small businesses. CDC is a non-profit that works under SBA guidelines.
Bank Loan A loan provided by a bank to individuals or businesses. CDC packages various funding sources, including bank loans.

What to do if this term applies to you

If you are a small business owner seeking financial assistance, consider reaching out to a Certified Development Company in your area. They can help you navigate the application process for loans and provide valuable resources. You may also explore US Legal Forms for ready-to-use legal templates that can assist you in preparing necessary documentation. For complex situations, consulting a legal professional may be beneficial.

Quick facts

  • Typical fees: Varies by CDC and loan amount.
  • Jurisdiction: Nationwide, with state-specific programs.
  • Possible penalties: Varies based on loan agreements and compliance.

Key takeaways

Frequently asked questions

CDCs help small businesses obtain financing for capital improvements by combining various funding sources.