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Follow on Google News | Solar Energy Studies - Rural Energy for America Program Guaranteed Loan Program (REAP LOAN) Wert-BeWert-Berater, Inc. is a provider of feasibility studies for the REAP Loan program. 888-661-4449
By: Vince Lewis The REAP Guaranteed Loan Program encourages the commercial financing of renewable energy (bioenergy, geothermal, hydrogen, solar, wind and hydro power) and energy efficiency projects. Under the program, project developers will work with local lenders, who in turn can apply to USDA Rural Development for a loan guarantee up to 85 percent of the loan amount. How does the B&I Guaranteed Loan Program compare to the Rural Energy for America Program Guaranteed Loan and Grant? To assist you in determining which program best fit your needs this comparison chart identifies the programs common and distinct requirements in an easy to read format. Guaranteed Loan Specifications Loans Limits: Loans up to 75% of the project’s cost Maximum of $25 million, minimum of $5,000 Maximum percentage of guarantee (applies to whole loan): 85% for loan of $600,000 or less 80% for loans greater than $600,000 but $5 million or less 70% for loans greater than $5 million up to $10 million 60% for loans greater than $10 millon up to $25 millon Fees and Interest Rates Lender’s customary interest rate, fixed or variable, negotiated by lender and business Lender’s customary fees, negotiated by lender and business One-time guarantee fee equal to 1% of guaranteed amount Annual renewal fee Benefits to Businesses Benefits include higher loan amounts, stronger loan applications, lower interest rates and longer repayment terms that can assist businesses that may not qualify for conventional lender financing. Benefits to Lenders Lender benefits include expanding lender’s loan portfolio, allowing lenders to make loans above loan limits, protecting guaranteed portion of loan against loss by the Federal Government, existing secondary market for REAP guarantees, helping to satisfy Community Reinvestment Act (CRA) requirements, and allowing lenders to use their own forms, loan documents, and security instruments. Eligibility: New definition being determined. Borrowers must be an agricultural producer or rural small business. Agricultural producers must gain 50% or more of their gross income from their agricultural operations. An entity is considered a small business in accordance with the Small Business Administration’ Eligible Project Costs Eligible project costs include: 1) Post-application purchase and installation of equipment, 2)Post-application construction or improvements, 3) Energy audits or assessments, 4) Permit or license fees, 5) Professional service fees, 6) Feasibility studies and technical reports, 7) Business plans, 8) Retrofitting, 9) Construction of a new energy efficient facility only when the facility is used for the same purpose, is approximately the same size, and based on the energy audit will provide more energy savings than improving an existing facility, 10) Working capital, 11) Land acquisition. How to Apply To apply for funding for the Guaranteed Loan Program, please contact your Rural Development # # # Wert-Berater, Inc. is a provider of feasibility studies for real estate development projects including USDA Business and Industry loan guarantee programs throughout the USA. End
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