The USDA Business and Industry (B&I) Program is designed to improve, develop, or finance businesses, industry and employment, and improve the economic and environmental climate in rural areas. It is mainly used to acquire or refinance commercial real estate.
Other eligible uses of proceeds such as working capital and equipment acquisition financing can be considered by LCC in conjunction with a commercial real estate loan request.
You’ll need a 1st Deed of Trust/Mortgage on commercial real estate which meets USDA qualifications, along with a maximum Loan to Value of 80%.
To be eligible you must be engaged in or proposing to engage in a business which will:
- Provide employment
- Improve the economic or environmental climate
- Promote the conservation, development and use of water for aquaculture
- Reduce reliance on nonrenewable energy resources by encouraging the development and construction of solar energy systems and other renewable energy systems.
- The borrowing entity must reside in a community (MSA) of 50,000 or less as determined by the most recent US Census (You may need to contact LCC directly for help with determining the eligibility of your property)
- You must have tangible balance sheet equity at the loan closing of no less than 10 to 20% for existing businesses, 20% for new business and 40% for energy or bio-based businesses.
We create lending solutions
Your investments can shape your world. We understand this. Every aspect of your funding with Fidelity Bancorp has been tailored to meet your investment needs. With over 26 years of experience in the industry, we appreciate how important your investment portfolio is to your future. Our unmatched team brings together the best of knowledge, resources, and partnerships that lead to a winning combination. Our ability to provide a one-stop-solution under one roof distinguishes us from other lending institutions.
We’ve worked hard to earn an outstanding reputation as a company who delivers.
We understand your challenges
We understand the challenges you face in differentiating between various lending options and utilizing them the best way to achieve your goals. It’s not a simple task, but at Fidelity Bancorp Funding, we simplify the process. We guide you confidently through the process and close your loan smoothly – protecting you from common pitfalls. Whether it’s doing our utmost to exceed your expectations, or keeping you informed throughout the process, FBF has you covered. Our approach works, and we’re not the only ones who think so.
Some examples of eligible use of proceeds are:
- To purchase and develop land, easements, rights-of-way, buildings or facilities
- To convert businesses, enlarge, repair, modernise or develop
- To purchase equipment, machinery or inventory
- To refinance existing business indebtedness which is not already structured with reasonable terms and conditions.
Here are the key points for this program:
- The most you can borrow is $5,000,000
- Real Estate Maturity and Amortization up to 30 years, with Equipment Amortization up to 15 years and Working Capital up to 7 years (Blended maturity and amortization is applied depending on the final structure as determined by B&I guidelines)
- The maximum LTV for Real Estate is up to 80%; for Equipment Acquisition, Working Capital and Debt Refinancing it’s up to 60% LTC
Multi-use owner occupied properties are preferred, here are some examples:
- Office: Professional, Condominium, Medical, Dental and Veterinarian.
- Industrial: Heavy and Light Manufacturing, Warehouse and R&D Flex.
- Retail: General.
- Special Use: Assisted Living Facilities, Adult Care, Day Care Facilities, Restaurants, Funeral Homes, Hotels/Motels.
Interest rates are generally adjustable based loans, tied to the Prime Index rate. Maturities up to 30 years are available based on use of loan proceeds. The USDA collects a 2% guarantee fee on the guaranteed portion of the loan. A 0.25% renewal fee is assessed annually based on the outstanding principal balance.
To qualify, here are the underwriting requirements:
- You must have prior ownership and management experience
- Minimum FICO of 680
- All loans are Full Recourse and require the personal guarantee of any and all individuals or entities holding 20% of the ownership interest or more
- A 1.25 x Minimum Debt Coverage Ratio (DCR) for the most recent FYE and Interim period is required.
We apply a winning philosophy
Our focus is on serving your needs. Our efficient process is driven by great people who understand our need to strive for excellent service to lead in our marketplace consistently. At Fidelity Bancorp Funding, we research all your funding options for you so you can relax knowing you’ll have the support you need.
As an established residential and commercial mortgage company based in Southern California, with offices in the heart of Orange County, we have closed over $10 billion nationwide.
