The USDA announced on October 1 that it is now accepting applications for its four major loan guarantee programs under the OneRD Guarantee Loan Initiative, which was launched earlier this year for ease of access. of lenders to these four loan programs.
“Rural America needs a mix of public and private partnerships and investments to build stronger, healthier communities,” said Bette Brand, USDA assistant undersecretary for rural development. “Under the leadership of President Trump and the Lost Secretary of Agriculture, USDA is cutting red tape and streamlining private investment so that we can be a better partner with rural America in building prosperity, because we know that when rural America thrives, all of America thrives.
The agency Posted a final rule for the OneRD guarantee loan initiative on July 13. Additional information on rates and conditions has been published end of August.
The initiative covers the Rural Energy for America program, the Water and Waste Disposal Loan Guarantee Program, the Community Facility Guaranteed Loan Program, and the Business and Industry Guaranteed Loan Program. The REAP program is particularly interesting for players in the biofuels and bioenergy industry. It provides loan guarantees and grants to agricultural producers and rural small businesses for renewable energy systems or to improve energy efficiency. Solid biomass, biogas and biofuels projects are among the renewable energy systems eligible for the program.
As part of the OneRD Guarantee Loan initiative, the USDA said it is standardizing requirements for credit reviews, loan processing, loan services, and loss claims. The agency said these measures will make the application process simpler and faster for lenders. The changes include a common loan guarantee application and consistent forms that lenders can use across all four programs.
In July, the agency also said it planned to issue loan note guarantees to lenders within 48 hours of providing documentation proving that the requirements of the conditional commitment were met. The USDA will also provide percentage collateral and fee requirements to lenders through a single annual notice at the start of each fiscal year and allow lenders to obtain approval for a loan guarantee before the start of the loan period. construction projects. The agency will also provide automatic approval to lenders in good standing who are overseen or created by state or federal regulators to participate in the four programs, while unregulated lenders can apply for approval to participate through a single certification process. which will be valid for five years.
In the announcement issued Aug. 31, the USDA said it was providing warranty percentages, annual fees, periodic retention fees and optional construction fees before fiscal 2021 to help lenders apply for the four affected loan guarantee programs.
USDA is organizing a online seminar for lenders on Oct. 8 to answer questions about the new process under the initiative. Additional information is available on the USDA website.