The Paradigm Shift
Most business owners walk into lending conversations fixated on their credit score. FSC First operates differently. As a CDFI (Community Development Financial Institution), they evaluate your ability to repay based on the percentage of available cash flow you can dedicate to loan payments.
• Credit score is the gatekeeper
• 680+ or you're out
• Personal credit drives the decision
• History > future potential
• Cash flow is the evaluator
• Can you service the debt?
• Business cash flow drives the decision
• Future capacity matters
Your job isn't to "fix your credit score." Your job is to demonstrate that your business generates enough cash flow to comfortably cover loan payments — and prove it with documentation.
This playbook shows you exactly how to do that.
The Math That Matters
FSC First evaluates what percentage of your available cash flow goes to debt payments. The key metric is your DSCR (Debt Service Coverage Ratio).
Target: 1.25x or higher — meaning you earn $1.25 for every $1.00 in loan payments
Monthly Net Operating Income: $12,000
Existing Debt Payments: $3,000
New Loan Payment: $2,500
Total Debt Service: $5,500
DSCR = $12,000 ÷ $5,500 = 2.18x check_circle
Monthly Net Operating Income: $8,000
Existing Debt Payments: $4,000
New Loan Payment: $3,000
Total Debt Service: $7,000
DSCR = $8,000 ÷ $7,000 = 1.14x cancel
Credit Separation
Even though FSC First weighs cash flow over credit score, credit separation protects you personally and strengthens your business profile for all future lending relationships.
Your individual credit history — mortgages, car loans, credit cards, student loans. Tied to your SSN.
Equifax, Experian, TransUnion
Score range: 300–850
Business debts hit your personal credit. Personal liability for business obligations. Harder to get a mortgage or personal loan.
Your company's credit history — vendor accounts, business credit cards, loans. Tied to your EIN.
Dun & Bradstreet (DUNS), Experian Business, Equifax Business
Score range: 0–100 (D&B PAYDEX)
Business obligations stay on business profile. Personal assets protected. Higher borrowing capacity over time.
Action Steps
If you haven't already separated your personal and business credit, start here. These steps create the foundation FSC First and all future lenders want to see.
Strategic Relationships
Capital access isn't just about documentation. It's about relationships. CDFIs like FSC First operate differently from banks — they're mission-driven and invest in relationships with the businesses they serve.
• Attend CDFI events and workshops
• Introduce yourself to loan officers
• Ask what programs fit your stage
• Get pre-qualification feedback
• Join accelerators (like this one)
• Respond to doc requests within 48 hrs
• Be transparent about challenges
• Ask questions — don't guess
• Submit complete packages first time
• Keep your loan officer updated
• Pay on time — every time
• Share business wins and growth
• Refer other business owners
• Come back for next round of capital
• Build toward larger loan products
FSC First has strategic alliances with Prince George's County EDC, SBA, Maryland Dept of Commerce, local Chambers, and 10–15 local banks. A strong relationship with FSC First doesn't just get you one loan — it opens doors to their entire network of capital partners.
$100M+ deployed to small businesses in PG County. They want to add you to that number.
Inside the Review
Understanding the lender's perspective helps you submit a stronger package. Here's what they evaluate and in what order:
| # | What They Review | What They're Looking For | Red Flags |
|---|---|---|---|
| 1 | Cash Flow | Can the business service the debt? DSCR ≥ 1.25x | Negative cash flow months, declining trend |
| 2 | Bank Statements | Consistent deposits, adequate balances, no NSFs | Frequent overdrafts, large unexplained deposits |
| 3 | Tax Returns | Revenue trends over 3 years, legitimate expenses | Declining revenue, no returns filed |
| 4 | Financial Statements | P&L and Balance Sheet match tax returns, clean books | Major discrepancies, missing statements |
| 5 | Use of Funds | Clear, specific plan for loan proceeds | "General working capital" with no specifics |
| 6 | Projections | Realistic growth tied to assumptions | Hockey stick growth with no basis |
| 7 | Owner Background | Industry experience, execution capability | No relevant experience, no plan |
Avoid These
Submitting page 1–2 of your 1040 instead of the full return with all schedules. FSC First needs K-1s, Schedule C/E, and all attachments for all 3 years (2022–2024), business AND personal.
Numbers without narrative are meaningless. Your projections need a written document explaining WHY you expect those numbers — customer pipeline, contracts in hand, market trends, hiring plans.
If personal and business funds flow through the same account, it's impossible to isolate business cash flow. This makes the lender's job harder and raises concerns about financial discipline.
Your Maryland Certificate of Good Standing must be current (within 90 days). If it's expired or you can't get one due to unpaid franchise taxes, that's a hard stop.
"Working capital" isn't a plan. Break it down: "$25K for equipment, $15K for inventory, $10K for marketing — here's exactly what each dollar does and the ROI timeline."
Interactive Assessment
Click each item to cycle through: check_circle Ready → warning Needs Work → cancel Not Started. Yellow and red items show specific fix-it steps with FSC First resources.
Business EIN, dedicated business bank account, no personal charges on business cards
DUNS number registered, D&B PAYDEX score 80+, trade references reporting
Net Operating Income ÷ Total Debt Service ≥ 1.25 (the number FSC First cares about most)
2022, 2023, 2024 federal returns — personal AND business — with all schedules
No overdrafts, no co-mingled funds, consistent deposits, official PDFs from bank portal
Maryland Certificate of Good Standing issued within 90 days, no unpaid franchise taxes
Attended FSC First info session or intro call, understand their programs and process
Find Your Fit
FSC First offers 12+ programs for small and minority-owned businesses. Here are the most relevant for Cohort 8 participants. Click any card to learn more on the FSC First website.
Core lending program for established small businesses. Flexible terms, competitive rates. Ideal for growth capital, equipment, and working capital.
Very Low Threshold program for businesses that don't qualify for traditional loans. Designed for startups and early-stage companies building credit.
For real estate and major equipment. Low down payment (10%), fixed-rate, long-term. Partner program with the U.S. Small Business Administration.
For energy efficiency improvements, solar installation, and green technology. Special rates for sustainability-focused projects.
Non-repayable funding for technology adoption and digital transformation. Check eligibility — grants are competitive and periodic.
Revolving Loan Fund for Bowie-area businesses. Low-interest, community-focused. Priority for businesses in Bowie BIC programs.
That's exactly what the lending relationship is for. FSC First's team will match you to the right program based on your cash flow, business stage, and capital needs. Start the conversation: fscfirst.com/apply
Before Next Session (Feb 19)
Complete these by next Thursday. Session 2 builds on this foundation — if you don't have these done, you'll be behind.
Next Session (Feb 19): Financial Statements & Projections / Cash Flow Management with Jeff Wilson (1st hour) and Playbook Development (2nd hour). Bring your P&L and Balance Sheet if you have them.
Resources
CDFI serving PG County & Maryland. $100M+ in loans. 12+ lending programs for small & minority businesses.
Contact: Jasmine Forbes
Web: fscfirst.com
Capital Accelerator Workshop — Cohort 8
Program Manager: Raymond Green
Phone: 301-383-1550
Web: bowiebic.com
Cash flow tells the story. Your documentation proves it.
Get the docs ready. Let FSC First do what they do best — fund your growth.