Small business loans available from USDA
The U.S. Department of Agriculture’s Rural Development office serving Arkansas has approximately $58 million available in its business and industry guaranteed loan program to utilize before September 30, 2010.
The program provides guarantees on loans made by lending institutions to assist businesses in purchasing and developing land and buildings, purchasing machinery, equipment, or supplies, and to provide working capital. Debt refinancing that improves cash flow for the business is also eligible. Creating new employment and retaining existing jobs in rural areas is the primary goal of the program.
“We don’t want people to be confused that because we are USDA that we only make loans to farmers,” said Lawrence McCullough Rural Development State Director, in a press release. “USDA Rural Development guarantees loans to new or existing business. We encourage businesses to contact us, or talk to their local bank to apply as early as possible.”
Sixty-Three percent of the funds that are available in Arkansas are a result of the federal stimulus funding that expires September 30, 2010. The stimulus funding has the advantage of offering up to 90 percent guarantees as opposed to the standard 80 percent. It also has no annual renewal fee and has a lower guarantee fee of 1 percent as opposed to 2 percent.
The business must be in an area with a population of 50,000 or fewer. Any business except farms, golf courses and those that receive more than 10 percent of their revenue from gambling are eligible.
“We encourage financial institutions, including community banks and Farm Credit to give us a call,” Mr. McCullough said. And as a reminder to the banks, the guaranteed portion of the loan can be sold onto the secondary market which would provide additional fee income.”
More financial news found on – Financial Watch
Related posts:
- Obama Seeks More Small Business Loans for Low-Income Communities
- Treasury Report Shows Drop In Small-Business Loans
- SBA loan activity increases in 2010
- Arizona small-business loans down
- US Treasury to Issue Loans to Lift Up Small Firms
Tags: financial watch, Loans