Applying for Rural Development Business and Industrial Loan Online

The rural loan program offered through the U.S. Department of Agriculture (USDA) and its Rural Development Program provides economic development opportunities for rural communities of less than 50,000 residents. The loan program provides private lender guarantees for loans to businesses, American Indian tribes, cooperatives and other business entities and individuals of up to 80 percent, depending on the amount of money being borrowed.

Applying for a Loan

The loan program can be applied for either in person or online, based on the lender’s requirements. Those lenders that offer an online application facility for its customers are able to quickly process the loan application and make whatever additional inquiries necessary to approve or deny the loan request. Applying online may also help the borrower provide preliminary loan information in anticipation of a tentative loan agreement contingent on the satisfaction of any additional requirements, such as a collateral assignment or co-signer or loan guarantor.

Completing an Online Application

To complete an online application, a borrower should determine which lenders in their area participate in the Rural Development Business and Industrial loan program. This information can be acquired by contacting a local USDA office via the web or on the telephone. With this information, the borrower should begin the process of contacting different lenders to determine which ones provide loans in the amount being requested and determine if an online application is available.

Many banks participating in the program can provide this information online for a borrower with a link for questions or real-time assistance. This will help the borrower understand better the purpose of the program, its qualifications, credit and collateral requirements that may be imposed by the lender, interest rates, terms and other loan conditions. When the borrower receives the answers to these questions, they should be able to begin the application process by providing the loan information needed to process the request.

Application Process

The approval process for these loans can take some time. This is due in part to the need of the lender to verify income and assets and determine the viability of the proposed or existing economic opportunity. This includes its impact on economic development, job creation, resource conservation or energy independence. When the lender has satisfied its underwriting requirements and due diligence, it can proceed with granting approval for the loan and issuing a check for the proceeds.

Online applications can streamline the loan process for a rural development loan but it may not necessarily speed up the timeline necessary to get the loan approval. This is dependent on the completeness of the application submitted by the borrower and the ability of the lender to verify the application in a timely manner. Applying online may provide a way for the borrower to reduce some of the processing time in order to receive a faster response to their loan request.