USDA Business and Industry Guaranteed Loans

First National Bank of Northfield is an eligible lender for the USDA Business and Industry Guaranteed Loan Program. The purpose of this program is to provide funding that will improve, develop, or finance business, industry and employment, and improve the economic and environmental climate in rural communities.

Contact one of First National’s experienced business bankers to see if you qualify.

Eligible Purposes Business and industrial acquisitions. Purchase of land, machinery and equipment. Construction, enlargement or modernization. Working capital. Refinancing when it is determined that refinancing is necessary to improve cash flow and create new or save existing jobs. Commercially available energy projects that produce biomass fuel or biogas.
Loan Size Maximum $10 million with exceptions up to $25 million in some circumstances.
Loan Terms Real Estate: 30 years
Equipment: 15 years or useful life
Working Capital: 7 years
Interest Rate The interest rate is negotiated between lender and applicant, and may be either fixed or variable. Rates are subject to agency review and approval.
USDA Fees The USDA guarantee fee is 2% of the guaranteed portion of the loan.
Guarantees The maximum percentage guaranteed by the USDA is 80% for loans of $5 million or less, 70% for loans between $5 million and $10 million, and 60% for loans exceeding $10 million.
Collateral Collateral must have documented value sufficient to protect the interest of the lender and the USDA.
Equity The tangible balance sheet equity requirement is:
Existing businesses: 10%
Startup businesses: 20%
Energy projects: 25–40%

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