RSSto improve the purpose of the Business & Industry (B & I) guaranteed loan program is to develop or finance business, industry and employment and improving the economic and environmental climate in rural communities. This task will provide the expansion of the existing private credit structure through the guarantee of quality loans in which a sustainable community benefits can be achieved.
General Program Requirements
A borrower may be:
A borrower may be:
- An individual
- A cooperative organization, corporation, partnership, or other legal entity organized and operated on a profit or nonprofit basis
- An Indian tribe on a Federal or state reservation or other Federally recognized tribal group, or
- A public body.
A borrower must be engaged in or proposing to engage in a business that will:
- Provide employment
- Improve the economic or environmental climate
- Promote the conservation, development, and use of water for aquaculture, or
- Reduce reliance on nonrenewable energy resources by encouraging the development and construction of renewable energy systems.
Individual borrowers must be citizens of the United States or reside in the U.S. after being legally admitted for permanent residence. Corporations or other non-public body organization-type borrowers must be at least 51 percent owned by persons who are either citizens of the U.S. or reside in the U.S. after being legally admitted for permanent residence. B&I loans are normally available in rural areas.
Loan Terms
The interest rate for the guaranteed loan will be negotiated between the lender and the applicant and may be either fixed or variable as long as it is a legal rate. Interest rates are subject to Agency review and approval. The variable interest rate may be adjusted at different intervals during the term of the loan, but the adjustments may not be more often than quarterly.
The interest rate for the guaranteed loan will be negotiated between the lender and the applicant and may be either fixed or variable as long as it is a legal rate. Interest rates are subject to Agency review and approval. The variable interest rate may be adjusted at different intervals during the term of the loan, but the adjustments may not be more often than quarterly.
The annual renewal fee is paid once a year and is required to maintain the enforceability of the guarantee as to the lender. There is also an up front guarantee fee of 2 percent. A limited amount of loans may be guaranteed with a 1 percent fee, subject to meeting regulatory requirements.
The maximum repayment for loans on real estate will not exceed 30 years; machinery and equipment repayment will not exceed the useful life of the machinery and equipment purchased with loan funds or 15 years, whichever is less; and working capital repayment will not exceed seven years.
The total amount of Agency loans to one borrower must not exceed $10 million. The Administrator may, at the Administrator’s discretion, grant an exception to the $10 million limit for loans of $25 million under certain circumstances. The Secretary may approve guaranteed loans in excess of $25 million, up to $40 million, for rural cooperative organizations that process value-added agricultural commodities.
Your Next Steps
The following information will lead you to the next steps to apply for this benefit.
Application Process
Complete applications should be sent to the USDA Rural Development State Office for the project location. Loan applications can be found by visiting:
http://www.rurdev.usda.gov/wi/Programs/rbs/library/full-application-business-and-industry.pdf
Complete applications should be sent to the USDA Rural Development State Office for the project location. Loan applications can be found by visiting:
http://www.rurdev.usda.gov/wi/Programs/rbs/library/full-application-business-and-industry.pdf
Program Contact Information
A list of offices and additional information can be obtained at:
http://www.rurdev.usda.gov/recd_map.html
A list of offices and additional information can be obtained at:
http://www.rurdev.usda.gov/recd_map.html
For more information please visit:
http://www.rurdev.usda.gov/rbs/busp/b&I_gar.htm
http://www.rurdev.usda.gov/rbs/busp/b&I_gar.htm
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