Guaranteed Loan Products
Small Business Administration (SBA) Loans
The SBA 7(a) loan guarantee program provides long term financing for small
businesses not normally available through conventional
commercial lending channels. This program provides the
nation's small business community with manageable long term
debt service. These guarantees are issued to qualified
credit worthy borrowers whose loan applications meet the
criteria of both the lending institution and the Small
Business Administration. Loans can be guaranteed to a
maximum amount of $5,000,000.
Small Business Administration (SBA) Pools
The collateral for SBA pools is loans to small businesses that are guaranteed by
the full faith and credit of the U. S. Government as timely
payment of principal and interest. Most of the pools are
adjusted to the prime rate and have no periodic cap and only a
few of the pools have a lifetime cap. The adjustability
feature along with the superior credit quality of the SBA pool
makes this investment an attractive product.
Small Business Administration (SBA) Strips
Interest only, known as "Strips", are a derivative product created as a
function of pooling of SBA guaranteed loans. The loans
from which strips are taken are generally variable rated based
on Wall Street Journal prime with monthly payments and monthly
or quarterly rate adjustments. Original maturities range
from 7 to 25 years. Strips offer investors a number of
attractive features such as the guarantee of accrued interest
by the full faith and credit of the U. S. Government,
attractive yields and a wide range of maturities.
United States Department of Agriculture (USDA) Loans
Loans guaranteed by the United States Department of Agriculture (USDA) are traded
nationally in an active secondary market and offer investors a
unique combination of safety, attractive yields and, if
adjustable, rate sensitivity. The USDA guarantees loans
through many programs.
United States Agency for International Development (AID) Loans
AID loans are 100% guaranteed by the full faith and credit of the U. S.
Government. Loans carry fixed or variable rate coupons
and normally have maturities ranging from 9 to 30
years. Ownership is evidenced by individual document
packages. Loans are made to assist the development of
friendly third world countries with participation from those
countries' governments. The full faith and credit
guarantee is only for investors that are U. S. Entities.
National Oceanic and Atmospheric Administration (NOAA) Loans
NOAA loans are 100% guaranteed by the full faith and credit of the U. S.
Government. Loans carry fixed or variable rate coupons with no minimum or
maximum denomination or maturity. Ownership is evidenced by individual document
packages. NOAA guarantees funding for the purchase of commercial fishing
vessels and related industries.
Overseas Private Investment Corporation (OPIC) Loans
100% guaranteed by the full faith and credit of the U. S. Government. Loans
carry fixed or variable rate coupons with normal maturities
ranging from 5 to 10 years. OPIC's purpose is to
promote economic growth in developing countries through
insuring investments against certain political risks and the
financing of enterprises through direct loans and/or loan
guarantees. Typical loan guarantees range from $2
million to $25 million, but can be as large as $50 million.