BND Drought Disaster Program – Breeding Stock Rebuilding Loan
This program is designed to provide financial relief to livestock producers impacted by the 2017 drought. It provides the borrower with financing to purchase and rebuild breeding stock to average levels pre-drought using a 2-year look back period to determine the base herd level the producer is trying to re-establish to. This program can also be used to replenish the breeding stock levels by retaining heifer replacements rather than selling them.
Applications will be accepted until June 30, 2018 at 5 p.m. CT.
The borrower must be a North Dakota resident who is a livestock producer from a county in D2, D3 or D4 according to the August 1, 2017 Drought Monitor Map, as well as counties adjacent to the D2, D3, or D4 counties. Cavalier, Pembina, Ramsey, Walsh, Nelson, Grand Forks and Traill counties are outside of these areas and are not eligible.
The program may be used to replenish breeding stock to previously established levels using a 2-year look back period to determine the base herd level. This program is not intended to assist with herd expansion.
BND will participate up to a maximum of 75 percent of the total loan amount. BND’s maximum participation amount is $500,000.
Fixed rate option: BND to net 4.50% with up to a 5-year balloon. Any interest-only period is included in the 5-year balloon. The lead lender may charge up to a 0.25% service fee.
Variable rate option: BND to net Base Rate minus 1.00% adjusting daily or monthly through maturity. The lead lender may charge up to a 0.25% service fee. Annual rate of increase is capped at 1% annually with a floor of 3.25%.
Fees: BND receives a $250 origination fee.
BND uses its normal credit standards in reviewing the loan.
Maximum loan to value of 75 percent on all chattels. Valuation is based on average market prices. BND and lead bank will share the collateral pro rata. Any FSA loans secured by the chattels will require FSA subordination.
Any financial institution in North Dakota can be the lead lender. BND will participate up to a maximum of 75 percent of the total loan amount. Lead lender is responsible for servicing the loan.
Up to 2 years interest only and then up to a 7-year amortization depending on lead bank discretion. Average age of livestock being financed should be considered in determining the amortization period.