Business Development Loan Program

The Business Development Loan Program assists new and existing businesses to obtain loans that have a higher degree of risk than would normally be acceptable to a lending institution. It may be used to start or expand a new business or for refinancing.

The business must be located in North Dakota. The financial condition or the nature of the industry must lead to a higher credit risk than would normally be acceptable to a lending institution.

Proceeds shall be used to:

  • Establish or purchase a new or existing business
  • Finance the acquisition of real property
  • Remodel or expand an existing business
  • Purchase or lease equipment
  • Provide working capital
  • Refinance an existing loan

BND’s maximum loan participation is $1,000,000.

Lead lender: Interest rate must be acceptable to BND.

BND: Variable rate is 0.50% below Prime, adjusted monthly or quarterly. Fixed rate is 2.25% above the Federal Home Loan Bank of Des Moines Advance Rate with a rate lock not to exceed five years.

Fees: An origination fee of up to 1 percent of the total loan may be charged and is shared with BND.

Equity requirements are evaluated on a case by case basis. A personal guarantee is required.

Adequate collateral is required and must be of such a nature that repayment of the loan can be reasonably expected. Security for the loan is evaluated on a loan-by-loan basis. Examples of acceptable security are:

  • Accounts receivable
  • Assignment of leases
  • Assignment of life insurance
  • Equipment
  • Fixtures
  • Furniture
  • Inventory
  • Leasehold improvements
  • Letters of credit, a guarantee from SBA, USDA Rural Development or other government source real estate

A lead lender is required. BND’s participation percentage is negotiated on a loan-by-loan basis. In most cases, BND will consider a participation of up to 90 percent of the loan.

Repayment terms vary depending upon the use of proceeds.

  • Real estate: 12-20 years
  • Equipment: 5-7 years
  • Working capital: 1-5 years

Bank Participation Loan Application (PDF)
Loan Renewal Application for Existing Participations (PDF)

PDFs will automatically download. Once downloaded, on desktop PC, right-click the file name in browser’s default download location, select “Show in folder,” open PDF. If you are not able to access a PDF, please contact us for assistance.

BND offers this loan by partnering with local lenders. To apply, contact your lender.

If you have any questions, contact us or call 701.328.5795.