Goverment loans
The United States Federal Government provides loans for Agriculture, Business, Disaster Relief, Education, Housing and Veterans. If you are a US citizen or permanent resident, this article aims to provide you with all the necessary information that you need to avail the financial assistance. The article is in three parts. The first, second and third parts cover Agriculture and Business, Disaster Relief and Education, and Housing and Veterans loans respectively.
1. Commodity Marketing Assistance Loans:
This program assists farmers to market their commodity crops and to get their farm income stabilized. Interest rates and the amount lent vary. These are short term 10 - month loans, with no prepayment penalties.
2. Farm Operating Loans and Farm Ownership Loans :
To avail these loans, applicants should own a family-sized farm. The loan may be used to purchase farm items or to cover farm-operating expenses. Under the guaranteed loan program, FSA provides guarantee up to $813,000. Applicants who are unable to qualify for a guaranteed loan may apply for a direct loan. Apart from developing and servicing direct loans, the federal Farm Service Agency Government Loans provides supervision and credit counseling to the applicant. The maximum amount for a direct loan is $200,000. Maximum time of repayment is 7 years. Collateral is required.
3. Farm Storage Facility Loans:
These loans are provided basically to construct or improve grain storage capacity. These are 7-year Government Loans involving variable interest rate. Maximum amount advanced is $100,000. There are no pre-payment penalties. Repayment can be done annually.
4. Fisheries Finance Program:
The applicant should have at least 3 years' experience in owning or operating a fisheries project or a comparable project and should be able to give a personal guarantee. These loans cater to farmers who run aquaculture, Mari culture, and commercial fisheries industries.
The Program will finance up to 80% of the depreciated cost of the project. The amount financed can be used to purchase or reconstruct a fishing vessel or to refinance any debt on a newly constructed fishing vessel.
These are fixed rate loans at an interest rate of 2%, repayable in 25 years or during the lifetime of the Government Loans project, whichever is earlier.
5. Rural Housing: Farm Labor Housing Assistance:
These loans are intended for individual farmers, Indian tribal folk and communities, farmers associations as well as, non-profit organizations and public agencies to develop housing facility for farmers and farm workers. The amount advanced can be used to buy or a lease a site, to construct a house, day care facility or community rooms, to buy durable household furnishings or to repay the interest on any existing construction loan. These are 33-year loans at 1% interest. The applicants should submit a pre-application to get qualified. If successful, they move on to actual applying.
These Government Loans are administered by The Small Business Administration (SBA), a federal Agency. The SBA does not provide any fund, but acts as a guarantor for the loans provided by lenders including banks, commercial institutions, community development organizations and micro-lending institutions. The lenders act under SBA guidelines. Though SBA stipulates the maximum rate of interests, the actual terms are negotiated between the lender and the borrower.
These are 10 and 20-year loans with fixed rate of interest. These loans can be used to buy land and buildings. Beneficiaries include companies that work for community development, public policy or companies with primary operations, which are the North American Industrial Classification System (NAICS). Personal guarantees and collaterals (in the form of project assets) are required for these loans.
Micro-loans
These are short-term 6-year loans. These loans are used to assist small businesses and not-for-profit child-care centers to invest in working capital or to purchase items like machinery and equipment. These loans are advanced via designated intermediaries who provide management and technical assistance to the beneficiaries. Application is submitted to the intermediary.
Economic Injury Disaster Loans
The SBA provides these loans to those businesses which are affected by a disaster and are unable to obtain credit elsewhere. The SBA advances an amount needed to maintain a reasonable working capital, expenses that could have been met to keep the business in normal shape or to keep the working capital in normal condition had the disaster not occurred.
These are long-term 30-year loans. The maximum interest rate is 4%.
The Federal Emergency Management Administration (FEMA) manages these loans.
Small Business Investment Company (SBIC) Loans:
These are long term loans developed by the SBIC, a unit of the SBA, for small businesses to build equity capital. The program also provides management assistance. Specialized loans assist small businesses owned by socially or economically disadvantaged individuals. Thus, the SBIC buys a part of the beneficiary\\'s business and becomes a partner in progress.
Military Reservist Economic Injury Disaster Loan Program
This loan program assists small businesses to meet essential operating costs when an employee is "called up" to active duty as a military reservist. This is a 30-year loan. Maximum amount advanced is $1.5 million at 4% interest, payable monthly.Borrowers who borrow more than $5,000 need to produce a personal guarantee and a first or second mortgage on the business property as collateral.
Physical Disaster Loans
These loans cater to businesses, which suffer physical damage in a declared disaster area. The loan amount can be used repair or replace damaged property so that the business is restored to its pre-disaster condition. The loan amount goes up to $1.5 million.
Charitable, religious and nonprofit organizations can also qualify for these loans obtain credit elsewhere are also eligible for these loans if they meet certain requirements.
Government Small Business Loan
Loan is financial help given by lender to borrower. Mostly it is returned back with interests. Lender could be anybody a bank, a government organization, private organization or some person similarly borrower could be any body a country, a state, any government or private organization, a student or any businessman. Study loans, Home loans, loan against property, personal loans, loan needed to set up business, loans for mortgage are different types of loans.
Benefits of taking loan:
A loan provide us with the money needed to buy some new things, get the older one repaired, to take care of educational expenses or to establish, expand, modernize or improve business. Community Development Credit Unions and banks are the safest and most affordable places to get loans.
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