Small Business

Microloan defined

Loans sought by entrepreneurs who do not have access to commercial or conventional loans. Parameters on microloans provided by the U.S. Small Business Administration include a $50,000 loan cap, which was recently raised from $35,000, and a 72-month amortization maximum. “The average microloan is closer to $10,000 though,” says Galen Gondolfi, chief communications officer of Justine Petersen, an SBA microloan intermediary lender. “In 2010 our average loan was $6,500, and in 2011 we will be closer to $8,000.”

Veronica, JP micro-borrower and owner of La Mancha Coffeehouse, speaks to the role of La Mancha in the Old North neighborhood.

You've probably heard about the importance of a good credit score -- it opens access to affordable mortgages, auto loans and reasonably priced credit, but it could also help to secure a job, buy a cell phone or establish utilities without paying a hefty deposit. And a low credit score will cost you. People with a weak credit rating willl pay approximately $250,000 more in interest throughout their working lives than those with stronger scores.