USDA Guaranteed Loan Purchase Program
The USDA (United States Department of Agriculture) Guaranteed Loan Purchase Program provides low interest rate loans to North Dakota businesses with bank financing that includes a loan guarantee from a federal government program such as the USDA Rural Development Business & Industry Loan Programs. BND can participate in a government guaranteed loan by purchasing the guaranteed portion of the promissory note. The purchase is conditioned upon the borrower receiving the benefit of the lower interest rate on the purchased portion of the note.
Bank of North Dakota requires evidence of the authorization of the government guarantee and other documentation as may be deemed necessary. USDA guaranteed lines of credit cannot be purchased.
Interest Rate: Rate may be variable or fixed. Rate options outside of the standard offering may be considered if loan pricing meets BND goals and objectives. BND will establish the initial interest rate at the time of funding. The lead lender may also add a reasonable servicing fee on the guaranteed portion purchased by BND. The interest rate on the originating lender’s share of the loan may be variable or fixed regardless of BND’s interest rate structure and must be in compliance with USDA Rural Development policy.
Fees: The originating lender may charge the borrower an origination fee as may be allowed by Rural Development.
Application by a lead lender is required for BND’s participation. Additional documentation will be required when submitting the request. The lead lender is responsible for servicing the loan
Loan terms are set between the borrower and Rural Development.