Revolving Loan Fund
Download the UMVRDC RLF Application here!
The UMVRDC Revolving Loan Fund is designed to provide gap financing for business and industry starting up or expanding in the five-county region of Big Stone, Chippewa, Lac qui Parle, Swift and Yellow Medicine. The primary focus of the program is manufacturing and industrial-related businesses that will create or retain jobs.
Eligibility: Must be located in Big Stone, Chippewa, Lac qui Parle, Swift or Yellow Medicine Counties.
Click here for a list of the RLF Advisory Board Members:
- Bank Participation
- Business Plan
- Past, Present and Future Financial Information
$5,000 – $100,000
Type of Assets Financed
- Fixed assets
- Working capital
- Real estate
- Fixed assets financed up to 10 years
- Real estate financed up to 20 years
- Working capital up to 5 years
- Average financing is 5 – 7 years
- Scheduled balloon payments are sometimes utilized
- Not less than 4% below prime with a minimum of 4%
- Most loans are made at 4 – 6%
- Fixed rate
- 10% borrower equity is required
- All loans must be secured with available assets, inventory, real estate and personal guarantees
- Loan repayments must be made by electronic transfer (ACH) or a participation agreement with the lead lender
- Borrower must demonstrate a gap financing need
|Following are links to assist you in starting or expanding your business:|
Financing Economic Development Projects
Today economic development projects are funded primarily through owner equity and private bank financing, with economic development fund available for “gap financing”. With economic development projects often time’s owner equity and conventional bank financing do not provide all of the funding that needed for a project. Typically because the bank has lending limits that they must adhere to, there is inadequate equity, there is insufficient collateral or the business cannot afford market interest rates and/or term requirements.
Economic development financing tools exist to help fill this funding “gap”.
Here is an example of a typical economic development deal:
|Owner Equity||Must be present in the package – must be at least 10% of the entire financial package. More may be required and more is better.|
|Bank Loan||Another required element in any financial package.|
|“Gap” Financing||Gap financing only comes into play when needed and only in the amount necessary to make the deal work. Gap funds could come from multiple sources.|
We do not compete with banks and in no instance will economic development financing replace bank
financing. Public financing exists to supplement private financing in order to move worthwhile economic development projects forward.
Contact the Upper Minnesota Valley Regional Development Commission at 320-289-1981 for additional information.
Posts from the 'RLF' Category
- Revolving Loan Fund Interest Rates at an All-time Low! on March 5, 2013
- Revolving Loan Fund is Here to Help Small Businesses on December 30, 2011
- Online Business Factsheets Now Available on December 20, 2011
- Porter Elevator Gets Help from Revolving Loan Fund on August 26, 2011
- UMVRDC Hosts Bus Tour for Board and Staff on August 9, 2011