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Beginning Entrepreneur Loan Guarantee Program
This program is designed to assist in business start-up financing by providing a financial institution with an 85% guaranty of a loan not to exceed $100,000.
Lead Lender - Any lending institution that is related or funded under the laws of ND or the United States. The lead lender will be responsible for submitting a Beginning Entrepreneur Loan Guarantee Program Lender Payment History Form to BND.
Borrower - A North Dakota resident, who has graduated from high school or received
a general equivalency certificate, has had some training by education or
experience in that type of revenue producing enterprise. The applicant(s),
must have a net worth of less than $200,000.
Guarantee - Bank of North Dakota may guarantee up to 85% of the amount of principal due the lender. The maximum loan may not exceed $100,000. The Bank may approve a guaranty on a loan up to $5,000 to a beginning entrepreneur for business start-up expenses including accounting, legal and business planning. The Bank may approve a guarantee on a loan up to $25,000 without requiring collateral for the loan.
Term - The guarantee term may not exceed 5 years.
Guarantee Fee - .5% per year or a one time fee of 2% of the guaranteed portion. The
guaranty fee may be included in the loan or in the rate charged by the
lender.
Application Process - Application by a lead lender is required to apply for BND's guaranty. See application
for additional documentation required when submitting a request to BND.
Lead lender is responsible for servicing the loan.
Interest Rate - The maximum amount the lender may charge may not exceed 3% above BND
base or NY prime. The guaranty fee may be included in the loan or in the
rate charged by the lender.
Other Features - This program can be used in conjunction with other BND loan programs.
The Bank may not guarantee more than $8,000,000 in loans under this program.
For more information about this program or other Bank of North Dakota programs,
contact:
Bank of North Dakota
1200 Memorial Hwy
PO Box 5509
Bismarck ND 58506-5509
(701) 328-5671
1-800-472-2166 ext. 5671
TDD (Telephone Device for the Deaf) 1-800-643-3916
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