Two Percent Loans

We provide loans to buy equipment and fix buildings.

Two-Percent Loan Program information

Two-Percent Loans provide financing to small Minneapolis businesses (retail, service or light manufacturing) to purchase equipment and/or to make building improvements. A private lender provides half the loan at market rate and the City provides the rest, up to $50,000 at 2 percent interest (up to $75,000 in designated neighborhood commercial districts). The loan term is set by the private lender and can be for up to 10 years. Bank fees vary, but the City charges a 1 percent origination fee with a minimum of $150 due at closing.

Terms and conditions

  • Applicant must repay the loan and be an acceptable credit risk
  • Use contractors licensed in Minneapolis
  • Meet Minneapolis city codes for all rehab work or equipment installations
  • Comply with Minneapolis zoning ordinances
  • Make efforts to hire Minneapolis residents through cooperation with the Minneapolis Employment and Training, for more information contact the workforce development manager.
  • Not use funds for billboard advertising.
  • The City cannot finance any work started prior to the loan

Who is eligible

  • All businesses located in the City of Minneapolis
  • The applicant may be individual owners, partnerships, corporations, tenant operators or contract for deed partners.
  • Businesses that benefit low-to-moderate income persons by creating jobs or improving services

Eligible uses

  • Lighting
  • Windows
  • Walls, ceilings, floors
  • Roofing
  • Plumbing
  • Electrical
  • Mechanical Systems and Air Conditioning
  • All work on the front and sides of business buildings facing public streets
  • Cleaning, painting and staining of exterior surfaces
  • Masonry repairs
  • Repairing or replacing of cornices, entrances, doors, windows, decorative details and awnings
  • Sign removal, repairing or replacement
  • Architectural design services for plans and specifications
  • Parking lots, including lighting, surfacing and landscaping
  • Building identification
  • Other items that are viewed necessary to complement the exterior of the building
  • Building permits
  • Energy audits
  • Energy conservation and energy retrofits
  • Handicap access
  • Streetscape costs not financed by special assessment
  • Production equipment
  • Equipment must be fixed
  • Financing of computers are approved on a case-by-case basis

How to apply

All programs and guidelines are subject to change without notice.

Request accessible format

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Contact us

Jennifer Schultz

Community Planning & Economic Development





Public Service Building
505 Fourth Ave. S., Room 320
Minneapolis, MN 55415