USDA Business Loan | North Avenue Capital | USDA B&I Loans


What is the USDA Business Loan Program?


from North Avenue Capital


The USDA Business & Industry (B&I) Loan Program is a government-backed loan program designed to help credit-worthy rural businesses obtain needed capital to grow and create jobs in their local communities. The program bolsters the availability of private credit by guaranteeing loans for businesses in rural areas across the US. 

Goal of Program

USDA Business Loans help to create jobs and stimulate rural economies by providing financial backing for rural businesses and properties. 

Build business. Grow communities. Strengthen economies. 

types of Qualifying Entities

For-profit Businesses

Nonprofit Organizations

Cooperatives

Federally-Recognized Tribes

Public Bodies

Individuals

Loans starting at $2 million 

USDA B&I Loans through North Avenue Capital require our borrowers to finance from $2 million business loans and up.

Looking for less than $2 million?

What is a USDA Eligible Area?

Business headquarters located in cities/towns with a population of less than 50,000 qualify as Rural America.

Did you know rural America makes up nearly 97% of the land in the US? 

*The white areas are eligible areas for a USDA B&I Loans. Shaded areas are ineligible areas for USDA B&I Loans. 

Find Out If You Qualify for a USDA Business Loan from NAC 

  • *Be advised, we do not fund loans under $1,000,000

What Sets an NAC USDA Business Loan Apart?

NAC is the only specialized commercial lender that exclusively lends USDA B&I Loans nationwide. It's all we do, and we know how to work with the USDA to get the deals to the finish line. We offer competitive interest rates, flexible terms, and high LTVs.

Interest Rates

NAC has the opportunity to offer competitive rates negotiated between the borrower and the lender based on Wall Street Journal Prime Rate at the close of the loan. Rates are typically variable. Higher credit borrowers benefit from lower rates.

Collateral

Collateral (tangible assets) should be equal to or greater than the loan amount.  

Flexible Terms

Because NAC has the opportunity to provide our borrowers with terms that fit their financial needs.  If you are looking for business financing nationwide in rural America and beyond, Look North. 

NAC Terms & Fees

North Avenue Capital (NAC) fully abides by the guidelines and regulations set forth by the United States Department of Agriculture (USDA) via the USDA Rural Development Program.  NAC is registered as a nationwide USDA Business & Industry (B&I) direct lender. 

Maximum Advance Rates

Commercial Landholdings: 80% Fair Market Value (FMV)

Equipment: 70% Fair Market Value (FMV)

Inventory: 60% of Book Value (Raw Inventory & Finished Goods Only)

Accounts Recievable: 60% of Book Value (Less than 90 days)

Maximum Loan Guarantee

80% = Loan amount < $5MM

70% = Loan amount: $5MM-$10MM

60% = Loan amount > $10MM

 

Interest Rates

Wall Street Journal Prime at Loan Close + 1-3%

(1-3% is based off of the risk of the business, industry, and borrower credit)

 

Underwriting & Security Requirements

  • Proposed operation must have realistic repayment ability
  • New enterprises will be asked to obtain a Feasibility Study from a nationally recognized independent source
  • The Business & Owners must have a good credit history
  • At loan closing/project completion, the business must have a tangible balance sheet equity position of: 10% or more for existing businesses, or 20% or more for new businesses. 
  • Personal and Corporate Guarantees are normally required from all proprietors, partners (except limited partners), and major shareholders (i.e., all those with a 20% or greater interest)
USDA Business Loans Available 

from North Avenue Capital

FAQ

USDA B&I Loan is one of many names you will hear brokers, financial subsidiaries, and owners use in the industry. USDA B&I stands for USDA Business & Industry Loan. It is one of the five loans under the USDA Rural Development Program umbrella. USDA B&I Loans from North Avenue Capital start at $2 million and have a dynamic maximum of $25 million. More ways you will see USDA B&I Loans said in the market is simply a USDA Business Loan or a USDA Commercial Loan. The USDA Rural Development Program is the sister program of the Small Business Loan Program or SBA Loan Program. 

  • Hotels/RV Parks
  • Family entertainment centers to include movie theaters, bowling alleys, go-karting, waterparks, amusement parks
  • Oil and gas- gas station or gas refinement, etc. (no exploratory efforts)
  • Waste Removal services & Landfills
  • Commercial real estate properties (owner-occupied or tenant-occupied)
  • Wineries, vineyards, distilleries
  • Bars, restaurants
  • Dentists, Healthcare
  • Hydroponic Farms
  • Manufacturing Facilities
  • Industrial Facilities
  • Grocery Stores
  • Textile Manufacturing
  • Event Venue/Wedding Venues
  • Landscaping Nurseries
  • Timber/Lumber Yards
  • Fabrication companies
  • Bio testing facilities/labs
  • Pharmaceuticals
  • & More

The USDA defines 'rural' by the 2010 Census, meaning a lot of areas that are in question, actually could be considered 'rural.' Did you know that 97% of America's landmass is considered 'rural' by this definition? Check out our Map online! 

North Avenue Capital (NAC) finances $2 million dollar projects and higher. Our average loan size as of 2022, is $13 million. 

Yes!  We fully fund the loan from start to finish and service the loan for the life of the loan. 

Yes!  NAC can lend for refinancing, acquisition, start-up businesses, new-construction loans, etc. We can also add working capital to a refinance, if applicable. 

Reach out! The sooner the better. Reach out via online chat, over the phone directly, or send an email to [email protected]