B&I Consulting Group - USDA B&I FAQ's

USDA B&I FAQ'S
 
 
USDA BUSINESS AND INDUSTRY
LOAN PROGRAM FAQ’S
 

 
 
 
 
Q What are the borrowers benefits?
 
A: Government guarantee usually at 80% helps banks to lend in rural areas,
lower down payment, up to a 30-year term, fully amortizing (no balloon), flexibility to finance land, building, equipment, permanent working capital and to a limited extent crops, in-state authority, can be used for investor properties, non-profits, combined with SBA loans, no maximum net worth.

 

Q What is the programs history?

A: Established in the 70’s to help lenders to fill the lending gap in rural areas. The program has evolved and had its biggest year ever in 2009.  

Q How does it work?   

A: A lender must approve the loan, the USDA offers a guarantee to the lender. USDA is national, delivered on a State basis: see USDA.gov


Q Why have USDA loans been seen as difficult?”
 
A: Bank policy and processing conforms to SBA policy, not USDA policy and most loan officers have only done a few, if any. As a result, many viable USDA loan requests can languish or fail without thorough knowledge of USDA policy and start-to-finish coordination. Our innovative process identifies, manages and resolves issues for consistent results; please see ‘Getting A Loan’ page.


Q What are the benefits for Lenders?
 
A: Serve customers better and attract new ones while reducing risk with an 80% Federal Guarantee. Retain and attract deposits while generating significant new fee income. Please ask for our Lenders Benefits Analysis.
 
Q What is the average loan size?
 
A: About $1.0 million, loans can go up to $25 million.
 

Q What businesses / properties qualify?
 
A: Owner-occupied, investor and non-profits. Many types of businesses qualify: see our Recent Financings page.
 

Q What are the eligibility requirements?
 
A: A rural location and minimum tangible net worth: other requirements apply. We resolve eligibility issues.
 

Q Does the USDA do loans for energy generation?
 
A: Yes, through the REAP program, Rural Energy for America Program, and the B&I loan program.

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