Business and Industrial Loan Guarantees Print Share
Business and Industrial Loan GuaranteesAdministered by the Rural Economic and Community Development (RECD) service within the Department of Agriculture, the B&I Loan Guarantee program's main objective is to improve the economic conditions of rural areas by aiding public, private, or cooperative organizations who seek loans for economic development purposes. Guarantee levels vary according to the size of the loan: 90 percent of principal and interest for guaranteed loans of $2 million or less, 80 percent for loans between $2 million and $5 million, and 70 percent for loans between $5 million and $10 million. The RECD contracts with local organizations, providing lenders with guarantees of full reimbursement for losses on loans made through this program. One of the main requirements established by the RECD, states that these participating financiers must ensure that sufficient collateral is offered in order to recover a guaranteed loan. In addition, the applicant must have in its possession sufficient equity, in the form of cash or other assets, to serve as a reasonable guarantee of its ability to carry out successful projects. moreinfo.jpg (3202 bytes) U.S. Department of Agriculture Rural Economic and Community Development |