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Trade Area
BND's primary trade area is the State of North Dakota. While not prohibited by law from reaching beyond the State's boundaries, BND will not make nor participate in loans to borrowers whose residence or place of business is outside of the State. If it can be shown that the benefits of a loan will flow to the State or its residents, BND will consider a loan participation outside of the State.
Loan Application
All loans are reviewed on an individual basis to ensure the general credit standards of BND are met. All loans require an identified purpose and a specific source of cash flow which reasonably assures repayment of the loan.
Each loan program has specific requirements for the appropriate application procedure: (1) directly by the borrower or, (2) through a local lender. In either case, the application should include sufficient information to allow BND to properly evaluate the merits of the loan. Business and personal financial statements, projections, and other supporting data as described in the Information section of each loan program are required for all applicants. The required information should not exceed what is needed by any conventional lender to properly evaluate a loan request.
Type of Lending
BND is involved in two types of lending: direct lending and participation loans.
By state law, BND is restricted from lending directly to a borrower. However, legislative action has given direct lending authority to BND for:
- The purchase or acquisition of bank stock or the formation of a bank holding company.
- The acquisition or refinancing of farm real estate by qualified individuals.
- Assistance with post secondary educational costs (i.e., student loans).
All other lending by BND is through participation with a lead financial institution. This lead lender can be any qualified financial institution - most notably a bank, savings and loan, credit union or Farm Credit Services.
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