Loan Insurance Program:

The loan insurance program insures a portion of a loan to a business made by a participating financial institution.

Eligibility: Businesses located in the State of Maine.

Insurance Types:

  • Pro-rata: covers a certain percentage of lenders loss after a default and liquidation, up to 100%.
  • Leveraged: covers 100% of lenders loss up to 75% of the loan amount.

Loan Amount/Exposure:

  • Traditional Application Process: Up to 90% of a lender’s loan on a pro-rata basis or up to 25% on a leveraged basis. 100% insurance is available for loans to veterans, oil storage facility projects, and waste oil disposal site clean-up projects. FAME exposure to any one relationship may not exceed $4,750,000 (this amount is reviewed and set annually).
  • OLA Application Process: Up to 60% of a lender’s loan on a pro rata basis. FAME exposure may not exceed $250,000.
  • Some eligibility requirements apply to working capital loans.

Guidelines to Restructure Existing Debt: Contact FAME for details.

Interest Rate: Interest rate isdetermined by lender.

Loan Term: Consistent with the useful life of the assets being financed or provided as collateral.

Security: Assets being financed and other business assets as necessary.

Guarantees: Unlimited personal guarantees of business principals, secured by personal assets (where available), are generally required.

Process:

  • Traditional Loan Insurance: Fact sheet and application are available on the FAME web site. Lender provides a complete application. Most loan insurance decisions are made at the staff level; however, decisions on FAME exposures of $1 million or greater must be approved by the FAME Board of Directors.
  • On Line Answer (OLA): lender applies on-line with immediate answer. Contact FAME for details to enroll.

 

Contact: Finance Authority of Maine, 207-623-3263
www.famemaine.com

 

Linked Investment Program for Commercial Enterprises:

This program reduces borrower’s interest rate. Loans will be approved and funded by lenders according to their own policies. The Maine State Treasurer will make a deposit in the form of a Certificate of Deposit (CD) at up to 2% less than prevailing rate providing similar discount is applied on the lender’s loan to business.

Eligibility:

  • Non-agricultural, for-profit businesses located in Maine.
  • 20 or fewer employees or annual sales of less than $2.5 million
  • Must be manufacturer or have 70% of sales outside the state.
  • Loan proceeds for real property, fixed assets, research, or working capital.
  • Create or retain one job for each $20,000 of deposited funds.

Loan Amount/Exposure: Maximum CD investment of $200,000 (actual loan amount may be greater).

Interest Rate: up to 2% interest rate savings to borrower.

Loan term:

  • CD investment made for maximum of one year (loan term may be greater).
  • Participation limited to 2 years

Security: Collateral requirements are at lender’s discretion. The Treasurer’s CD investment is not pledged as collateral for the loan.

Process: Contact FAME for reservation application.

Additional Information: Loans approved and made by lenders according to their own policies. This investment does not constitute loan collateral. Loan does not to be insured by FAME

Contact: Finance Authority of Maine, 207-623-3263.
www.famemaine.com