Application Notes:

Prior to submitting an application, applicants must contact the appropriate state community programs director. A list of Rural Development (RD) state offices can be found online at www.rd.usda.gov/about-rd/offices/state-offices.

Applications are accepted on a rolling basis.

The program officer confirmed that applications are accepted on a rolling basis.

Applications must be emailed to the appropriate RD state offices listed online at www.rd.usda.gov/about-rd/offices/state-offices.

Applications must include:

• Form RD 5001-1: application for loan guarantee
• Written credit evaluation and credit evaluation checklist
• Environmental information (as applicable)
• Financial statements
• Current credit reports or the equivalent
• Draft loan agreement (if applicable)
• Loan classification and credit risk rating classification scale
• Real estate appraisals
• Chattel appraisals
• Feasibility study
• Business plan (if applicable)
• Copies of organizational documents, organizational charts, and existing debt instruments (if applicable)
• Form RD 5001-12: certification of non-relocation and market and capacity
• Form HUD-935.2A: affirmative fair housing marketing plan (AFHMP) (if applicable)
• SEC Form 10-K: annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 134 (if applicable)
• Certificate of need (if applicable)
• Intergovernmental consultation comments (if applicable)
• Form RD 5001-2: lenders agreement (If applicable)
• Form RD 5001-2a: multistate and non-traditional lender’s agreement (if applicable)

Prior to submitting an application, applicants are encouraged to submit an optional request for a preliminary eligibility review to the appropriate RD state office listed online at online at www.rd.usda.gov/about-rd/offices/state-offices. Refer to pages 61-64 of the Guide file for additional information regarding requesting an optional preliminary eligibility review.

Applications will be evaluated according to the following priority criteria:

• Population priority
• Location priority
• Guaranteed loan features
• High-impact business development
  investment priorities
• Administrative points

Refer to pages 64-65 of the ProgramRule file as well as pages 78-80 of the Guide file for additional information regarding the application evaluation process for this program.

Refer to the NOFA, Guide, and ProgramRule files, as well as the Application folder, for additional application information.

Match Notes:

There are no stated matching requirements for this program.

Borrowers must demonstrate collateral that have documented value sufficient to protect the interests of the lender and of the funding agency. Lenders may discount collateral consistent with sound loan-to-value policy, with the discounted collateral value being at least equal to the loan amount. The lender must provide satisfactory justification of the discounts being used.

In addition, the following loan fees apply to this program:

• Initial guarantee fee, which is currently 3 percent of the guaranteed amount
• Guarantee retention fee, which is currently 0.55 percent of the guaranteed portion of the outstanding principal balance, paid annually
• Additional reasonable and customary fees for loan origination, which will be negotiated between borrower and lender

Qualifying projects may receive a reduced fee of 1 percent. Refer to page 9 of the NOFA file as well as the Fees file for additional information regarding loans fees that apply to this program for FY 2025.

Funding Notes:

For FY 2025, as of April 2025, a total of $2,691,975,359 is available to support loan guarantees through this program. Current information regarding the total funding available through this program can be found online at www.rd.usda.gov/onerdguarantee.

For FY 2025, the loan guarantee percentage is 80 percent.  

In general, the maximum total amount of guaranteed loans that may be made to a borrower is limited to $25 million; however, guaranteed loan amounts of up to $40 million for rural cooperatives that process value-added agricultural commodities may be approved by the funding agency.

Interest rates are negotiated between the lender and borrower. Rates may be fixed or variable; however, variable interest rates may not be adjusted more often than quarterly.

Loan terms will be based on the use of guaranteed loan funds, the useful economic life of the assets being financed and those used as collateral, and the borrower's repayment ability. Loan terms will not exceed 40 years.

Funds may not be used for:

• Lines of credit
• Owner-occupied and rental housing
• Golf courses or golf course infrastructure
• Racetracks or gambling facilities
• Agricultural production, with certain exceptions, as detailed on page 4 of the NOFA file
• Distribution or payment to a beneficiary of the borrower, or an individual or entity that will retain an ownership interest in the borrower

Refer to pages 29-31 and 33-34 of the ProgramRule file for information regarding additional ineligible costs

For FY 2023, two loans of $614,226 and $12,810,490 were provided through this program. In May 2022, loans ranging from $180,000 to $25 million were provided. In February 2022, loans totaling $1,151,281,875 were provided. Refer to the Award file for details.