The U.S. Department of Agriculture’s Rural Development office serving Delaware and Maryland has about $41 million available in its business and industry guaranteed loan program to promise before September 30.
“We don’t want people to be confused that because we are USDA that we only make loans to farmers,” said Jack Tarburton, USDA Rural Development State Director, in a press release. “USDA also guarantees loans to new or existing businesses. We encourage businesses to contact us, or talk to their local bank to apply as early as possible.”
The program provides loan guarantees to lending institutions for businesses to retain or add jobs and to improve, develop or buy land, buildings, machinery or supplies.
Seventy percent of the funds that are available in Delaware and Maryland are a result of the federal stimulus funding that expires on 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 fees 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. Tarburton 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.”
For more information, call Rural Development representatives Bruce Weaver at (302) 857-3629 or Jeff Allen at (302) 857-3588.
