Westar Trade Resources has successfully assisted clients with obtaining over $65 million in USDA loan guarantees. In addition, we specialize in “layering” multiple financing sources in order to achieve successful commercialization. We possess expertise in identifying and securing all sources of public & private financing available for a multitude of projects, including:
- Traditional bank financing
- USDA Business & Industry Loan Guarantee Program
- USDA 9003 Biorefinery Loan Guarantee Program
- USDA 9007 Energy Grant and Loan Guarantee Program
- USDA Value-Added Producer Grant Program
- USDA Community Facilities Grant and Loan Program
- DOE Guaranteed Loan Program
- Other federal, state, and local grants
- Subordinated debt financing
- Purchase order financing
- New Market Tax Credits, 1603 Tax Grant, ITC and REC Credits
- Special tax exempt bond programs
- Other government direct loans
- State loan programs
- Federal procurement programs
- OPIC, Ex-Im Bank, and World Bank financing
- USTDA feasibility study grants
Utilizing a bond financing approach combined with a USDA B & I Loan Guarantee provides a new opportunity for many project developers to obtain financing, and accomplishes the same objective as the traditional approach.
Lenders benefit from using bond financing with a USDA B & I Loan Guarantee in these three ways:
1. Lenders can make more loans - by only being required to retain a minimum of 5% of the unguaranteed portion of the loan under the bond approach, allowing the bank to leverage their lending limit and be able to lend more and limit their exposure to the minimum retention.
2. No syndication – an investment bank will sell the bonds to a willing and ready bond market, eliminating the lender’s need to assemble a syndication group of banks for larger loans.
3. The unguaranteed portion of the loan is readily accepted in the bond market – high yield bond funds are very accustomed to buying bonds that carry more risk, where banks are unable or unwilling to take on the risk of the unguaranteed portion.
Longer term financing – while banks currently prefer loan terms of 3 to 5 years, the bond market is looking for terms of 15 to 25 years on average.
2. More competitive interest rates – the longer term and blended interest rates between the unguaranteed and guaranteed bonds can usually assure the borrower of a fixed interest rate at a reasonable or lower rate than current bank rates for a fixed or variable rate loan.
We look forward to hearing from you and discussing current and future projects which could benefit from the services we provide, and assist you with developing new, innovative financing approaches. We are here to help you!
Download the documents below for more information.