If SEF decides to make a loan, the client will receive an offer letter. The letter includes the basic terms of the loan, such as the interest rate we are offering, along with proposed securities.

If the client decides to accept the offer, they sign and return a copy to SEF. A financing agreement and security documents will then be prepared by SEF’s lawyers who will work with the client’s lawyers to arrange with the client for signature. When all the documentation is in place, funds will be released according to our agreed disbursement schedule.

Offer conditions

Sometimes an offer may be made with conditions because of various timing issues. These can include everything from permits to purchases that could not be completed until financing is confirmed. These conditions are important and must be satisfied before any funds are released.

Legal fees

SEF does not charge application, administration or change fees, but clients are responsible for the initial legal costs SEF incurs to prepare and register the security documents. These fees will either be subtracted from the first disbursement of funds or invoiced at a later date.

Do we need a lawyer?

It’s not a requirement by SEF, but it is probably a good idea. You will be considering a substantive legal agreement, perhaps more complicated than any you have encountered before, and you may be committing your enterprise to live with for years to come. Our experience is things go much more smoothly for our clients if they have their own legal counsel.

If you decide not to use a lawyer, SEF can arrange for final document signing to be handled by our lawyer, who will ensure that all necessary copies and affidavits are correctly prepared. Please contact our executive director for details.

Ongoing reporting

It is important that SEF tracks the impact in the community of our loans, and we look forward to celebrating your successes. After an offer is accepted, we work with our clients to create a straightforward, mutually agreed upon annual measurement report on your activities.

SEF also requires annual third-party prepared financial statements from our clients, usually at the Review Engagement level. We will consider a Notice to Reader level, but this should be requested during completion of the Financing Agreement.

Early repayment

SEF does not charge change fees or penalties if our clients want to repay some or all of their loan before the end of the term. Contact SEF’s executive director for details.