CIT Group Inc. is a bank and financial holding company headquartered in New York City. The bank was incorporated in Delaware, and its subsidiary, CIT Bank, is headquartered in Pasadena, California.
The CIT group also offers business loans, commercial and equipment financing. Below we have discussed some of the small business loans that the CIT group offers.
3. SBA 504 Loan Program
- Loan: 5 million dollars
- Term: 25 years for real estate refinancing, ten years for working capital and equipment
- Use: Business expansion, purchasing and refinancing commercial real estate, accessing working capital, and buying equipment.
Transactions in California Only
4. SBA 7(a) Loan Program
- Loan: 250,000 to 13.75 million dollars
- Term: 25 years (for owner-occupied commercial real estate)
- Use: Refinancing and purchasing commercial property.
Available in all Non-Judicial States
5. Conventional Owner-Occupied CRE
- Loan: 250,000 to 10 million dollars
- Term: 10 years for refinancing and purchasing owner-occupied real estate
- Use: Refinancing and purchasing purposes
Transactions in California Only
Types of Loans offered by CIT Group
6. SBA 504 Loan Program
- Loan: 5 million dollars
- Term: 25 years for real estate refinancing, ten years for working capital and equipment
- Use: Business expansion, purchasing and refinancing commercial real estate, accessing working capital, and buying equipment.
Transactions in California Only
7. SBA 7(a) Loan Program
- Loan: 250,000 to 13.75 million dollars
- Term: 25 years (for owner-occupied commercial real estate)
- Use: Refinancing and purchasing commercial property.
Available in all Non-Judicial States
8. Conventional Owner-Occupied CRE
- Loan: 250,000 to 10 million dollars
- Term: 10 years for refinancing and purchasing owner-occupied real estate
- Use: Refinancing and purchasing purposes
Transactions in California Only
9. Equipment Financing
- Loan: 500,000 dollars
- Repayment: Deferred, monthly and seasonal
- Uses: Equipment, computer hardware, and software, construction equipment, POS terminal, vehicles, and capital equipment
- Term: 6 to 72 months
- Funding Speed: 24 hours
10.Working Capital Loans
- Loan: 150,000 dollars
- Repayment: Daily or weekly
- Use: Purchasing of technology and equipment, soft costs, payroll, marketing, and cash flow management
- Funding Speed: Same day
11.Franchise Financing
- Loan: 500,000 dollars
- Repayment: Seasonal, monthly, and deferred (depends on financial product)
- Use: Upgradation of technology and equipment, working capital, remodels, acquisitions, and new locations
12.CIT’s Commercial Real Estate and Construction Loans
CIT has deep relationships, marketing expertise, and underwriting experience in the commercial real estate and construction industry. CIT underwrites commercial real estate transactions and offers construction and commercial loans for the following purposes:
- Property portfolios
- Loan portfolios
- Single properties
Products and Services:
- Operating leases
- Capital leases
- Management of assets
- Secured debt
- Synthetic leases
- Portfolio acquisitions
Geographical areas:
- Retail
- Industrial
- Office
- Multi-family rental
- Hospitality (select)
- Sale condominium
Focus areas:
- West coast
- Northeast
- Major nationwide markets
13.Business Equipment Financing
The business equipment financing will help businesses grow their capital. CIT offers small business equipment loans in less than a day and also provides several leasing options.
- Use: Purchasing of inventory, equipment, and technology. Cash flow management, working capital supplementation, and marketing.
- $ 1 Buyout: Available as an Equipment financing agreement (EFA) or as a lease.
- Fair Market Value: Lower lease payment; the equipment can be purchased or returned at the end of the term.
- Net Terms: Buy now and pay later, financing available for thirty, sixty, and ninety days
- Payment: Seasonal, monthly, and deferred.
CIT Group Interests, Fees, and Loan Options
3. SBA 504 Loan Program
- Interest rates: Long-term and Fixed
- Fees: 0.25 to 0.5 %
4. SBA 7(a) Loan Program
- Interest rates: Variable and fixed
- Fees: 0.25 to 0.5 %
5. Equipment financing
- Interest Rate: 5.49 %
- Fees: Not Specified
6. Working Capital loans
- Interest Rate: Depends on credit review and terms
- Fees: None
7. Franchise Financing
- Interest Rate: Depends on financial product
- Fees: Not specified
8. Business Equipment financing
- Interest Rate: Not Specified
- Fees: Not Specified
9. CIT Commercial Real Estate and Construction Loans
- Interest Rate: Not Specified
- Fees: Not Specified
What Lending Criteria does the CIT Group Have?
Below is the basic lending criteria that all the banks follow:
- Credit Score
- Annual Revenue
- Business Plan
- Collateral
- Time in Business
Credit Score
Credit is the most important component of all types of businesses, whether they are small or large. Lenders will always analyze the business's credit score and then decide whether it can pay the loan or not. Therefore, the best way to maintain a healthy credit score is to pay your dues on time.
Credit scores can also be easily obtained from several agencies such as Equifax, Dun & Bradstreet, and Experian. Another way of maintaining a positive credit score is to have a low debt-to-income ratio. Lenders will not invest in businesses that don't have a good credit score.
Annual Revenue
Another important factor that the lenders will review is the annual revenue of the business. Most lenders will only lend to those businesses that have been profitable for the last two years or more. Businesses need to make sure that all the financial statements are accurate and up to date.
Lenders will also look at specific details such as the current account (current assets divided by liabilities) and ask for copies of bank statements and transactions. However, businesses will only be eligible for a loan if their cash flow is growing.
Business Plan
A minority of lenders might not ask for a business plan, but most of them do, and businesses need to come with a clear and concise proposal. Usually, lenders require the business plan to know the purpose of the loan and discuss the business's stability.
One of the main components of business plans is the resumes of managers and staff. However, despite having a clear business proposal, the lenders will still ask for proof of the staff's ability and relevant credentials and experience.
Collateral
Collateral is an essential requirement, and most lenders will not provide a business loan if it cannot give collateral. Collateral can be anything like equipment or property. The collateral will also decrease the risk for the lender as it will have an asset in hand, so if the company fails to pay the loan, the collateral can be paid to fund the damages.
The owner of the company needs to provide a personal guarantee and will also need to submit some essential documents:
- Driver’s license
- Business license
- Tax returns (personal)
- Tax returns (business)
- Insurance plans of business
- Records for payroll
- Detail of owner
- Other financial obligations
Time in Business
Most banks are hesitant to lend loans to new companies that have been active for just a few months. Lenders cannot trust small businesses or startups that have just entered the market because they don't have a proper credit score and the cash flow is usually unstable. Banks will most likely lend to businesses that have been active for more than two years.
CIT Group Application
Following is the application procedure of all the banks that borrowers have to follow:
Before you apply for a loan, ensure that all your documentation is up to date. Also, organize all the documents properly, and if some essential documents are missing, contact the relevant authorities. Collect all the financial information about your business and pay all the dues as soon as possible.
- Personal and Business credit scores and history
- Account statements of the business
- IRS documents, tax returns of the business, and the owner as well.
- Other important financial documents such as unpaid invoices, credit card details, and accounts receivable.
- Legal contracts (leasing, franchising, incorporation)
However, for SBA loans, an additional criterion needs to follow:
- Owners who own 20 % of their business are required to guarantee unconditionally. However, if an owner has a controlling interest will be required to submit a guarantee.
- Startup businesses will require additional equity of 5 %. Special-purpose also requires a 5 % equity. Thus, the total equity requirement is 10 %.
Requirements for SBA (7a)
- Businesses should operate for 'For-Profit.'
- Business should be active only in the United States
- Significant invested equity
- Can use alternate financial resources (personal assets)
- Should be able to demonstrate loan need
- Funds should only be used for business purposes
Requirements for SBA (504)
- Businesses should operate for 'For-Profit.'
- Business should be active only in the United States
- Has a net worth of fewer than 15 million dollars and more than 5 million dollars
- Be an eligible business. Check here
- No other sources of finances should be used other than the 504 loan
- Funds should only be used for business purposes
For more information, access the website of the CIT group. Click here
Summary of CIT Group Loan Options
We have analyzed all types of loans that CIT Group offers, and below we have listed them.
- SBA 7(a)
- SBA 504
- Conventional Owner-Occupied CRE
- Working Capital Loans
- Franchise financing
- Business equipment financing
- CIT commercial real estate and construction loans
The good news is that borrowers will have many options available to them when they apply for a CIT loan. The loans mentioned above have different interest rates, terms and are designed to fulfill a specific business need. However, some loans offered by the CIT group ask for a near-perfect credit score, so make sure your credit score is up to mark.
Borrowers should also keep all their documents up to date, and before applying for the loan, discuss with the bank.