Commercial Loans and Fun Blog

Does Your Commercial Property Qualify for a USDA B&I Loan?

Need a USDA B&I loan? In order for your commercial loan to qualify for a guarantee from the U.S. Department of Agriculture, it needs to be located in a rural community. Normally this means a town of less than 50,000 people.

However, a great many cities in suburbia have a population of less than 50,000 residents, but these suburban cities are far from small rural towns. They sit right next to population centers with hundreds of thousands of people. Therefore they are not the type of small, rural community that needs help getting commercial financing.

To see if a property is eligible for a USDA B&I loan go to the following website:

http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=rbs

When the page comes up, click “I Accept”. It will take you to a map and you type in the address completely. You have to make sure that the address has street, city and zip code. This is essential. It will then bring up a map and tell you automatically if the property is eligible or ineligible.

Need a USDA business and industries loan (B&I loan)? Please call Tom Blackburne at 574-210-6686 or email him at tommy@blackburne.com.

It's a Terrific Commercial Loan Program if Your Property is Located in a Small Town

The USDA Business and Industries Loan (B & I Loan) Program is a Federal loan guarantee program that is designed to encourage the commercial financing of rural businesses. The reason why the Federal government is involved is because it wants to create and save rural jobs and improve the economic and environmental climate of rural communities.

Are you ready to apply for a USDA B&I loan? Please call Tom Blackburne at 574-210-6686 or email him at tommy@blackburne.com.

Here's what makes a B&I loan different: The Business & Industry Loan program is lender-driven. The USDA guarantees the loan rather than lending directly. A commercial lender requests the B & I guarantee, and, if it is approved, the commercial lender makes and services the loan.

The benefits of the B & I Guaranteed Loans Program for businesses is that the borrower gets a higher loan amount. The reason why is because the guarantee strengthens the loan application, allowing the bank to feel comfortable with a smaller equity injection.

B&I loans also offer lower interest rates and longer repayment terms. This greatly assists businesses that may not qualify for conventional commercial real estate financing, which provides the rural business greater stability and leads to greater growth, expansion and rural employment.

Below is a list of the authorized uses of the loan funds. A borrower must be engaged in, or proposing to engage in, a business that will (1) Provide employment; (2) Improve the economic or environmental climate; (3) Promote the conservation, development, and use of water for aquaculture; or (4) Reduce reliance on nonrenewable energy resources by encouraging the development and construction of solar energy systems, and other renewable energy resources.

Authorized Loan Purposes:

(1) Business and industrial acquisitions, construction, conversion, expansion, repair, modernization or development costs.

(2) Purchase of equipment, machinery or supplies.

(3) Start-up costs and working capital.

(4) Processing and marketing facilities.

(5) Pollution control and abatement.

(6) Refinancing for viable projects, under certain conditions.

(7) Purchase of start-up cooperative stock for family sized farms where commodities are produced to be processed by the cooperative.

Bottom line, the USDA Building and Industry Loan (B&I Loan) program is a terrific program if the commercial property is located in a town of less than 50,000 residents. A great many small motels are financed using the B&I loan program.

Are you ready to apply for a USDA B&I loan? Please call Tom Blackburne at 574-210-6686 or email him at tommy@blackburne.com.