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Regional Economic Development Group Since 1978

Regional Economic Development Group Since 1978. THREE LOAN PROGRAMS. Revolving Loan Fund Program (RLF) SBA 504 Loan Fund Program (SBA 504) Intermediary Relending Program (IRP). PROGRAM SUMMARIES. Program # of Loans Amount

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Regional Economic Development Group Since 1978

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  1. Regional Economic Development Group Since 1978

  2. THREE LOAN PROGRAMS • Revolving Loan Fund Program (RLF) • SBA 504 Loan Fund Program (SBA 504) • Intermediary Relending Program (IRP)

  3. PROGRAM SUMMARIES Program # of Loans Amount RLF 310 $ 16,293,198 SBA 504 197 $ 56,448,000 IRP 9 $ _ 425,000 TOTAL 516 $ 73,166,198 As of June 30, 2006 Active 188 $ 29,594,823 As of March 31, 2007

  4. Loan Security Documentation and Collection

  5. THE 5 C’s OF CREDIT Character Cash Flow Collateral Capitalization Conditions C

  6. COLLATERAL • Security given as a pledge for the fulfillment of an obligation. • Adequate to provide reasonable assurance of repayment in the event cash flow does not permit. • Must be perfected to be effective

  7. TYPES OF COLLATERAL • Real Estate • Personal (Chattel)Property • Other (ie. Guarantee)

  8. REAL ESTATE • Mortgage • Spousal Rights • Homestead Exemption • 3 day right of recession • Abstract Update or Basket Lien Search

  9. PERSONAL PROPERTY • Security Agreementunderlying written pledge or promise for fulfillment or repayment of a loan • UCC Financing Statement serves as public record of the pledge or promise and MUST match security agreement. • Abstract or basket lien search • UCC lien search

  10. State where corporation is incorporated Filing Online ( www.sos.state.ia.us ) Mail Develop standard, then cut & paste – check & recheck Lien and Tax Search County where collateral is located Lien Search WHERE TO FILE

  11. GUARANTEES • Unsecured • Secured • Spousal guaranty

  12. COLLECTIONS • Late Letter (10 days) • Warning Letter • Notice of Acceleration (Demand Letter) • Legal Action • Notice should include: • Specific amount due or in default • Cure Period • Include Notice to Guarantor • Smaller amounts are typically better worked out, larger amounts less probable (deeper hole)

  13. LOAN AGREEMENT PROVISIONS • Authorize lender to file and maintain all necessary financing statements • Deficiency of Conditions of Lending Section • Late payment and NSF Check fee. • (ie. Minimum $25) • Promissory Note, Loan agreement, Security Agreement and Financing Statements should parallel each other

  14. INNOVATIVE STRATEGIESHIDDEN SECURITY OPPORTUNITIES • Vehicles titled and not included under UCC • Home equity or other real estate held • Purchase money security interest in certain assets • Disburse funds for project (equipment) • Financing statement should include, at a minimum, make, model & serial number • Debtor must take possession within 20 days

  15. INNOVATIVE STRATEGIESHIDDEN SECURITY OPPORTUNITIES • Life insurance assignment - death benefit and cash surrender value • Intercreditor agreement • Subordination agreement

  16. BROCHURES AVAILABLE Black Hawk Economic Development, Inc. The Organization Revolving Loan Fund (RLF) Program SBA 504 Loan Program IRP Loan Program Credit and Finance Factors

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