January 2018 - EDF Newsletter - Interest Rates, Lender Leader Board and Other News!

January 2018

January 2018 Interest Rates

20 Year Standard Rate - 4.64%

20 Year Refinance Rate - 4.69%

10 Year Standard Rate - 4.66%

10 Year Refinance Rate - 4.71%

SBA Program Benefits and Reminders

EDF partners with lenders on 504 projects throughout the State of Michigan. The most common 504 structure is the acquisition of real estate and/or equipment where the lending institution finances 50%, SBA finances 40%, and the borrower injects only 10% into the project. Our staff is available to help structure any project, so please contact our office for assistance.

Interest rates are fixed for the life of the loan, either 10 or 20 years. The current 20 year rate is 4.64% and the current 10 year rate is 4.66%! Projects that are straight refinances of exisiting debt are currently funding at 4.69%.

A project can include land, building, improvements, soft costs and equipment. In most circumstances or situations, all amounts can be rolled into one SBA 504 project.

Refinancing existing debt is now eligible for 504 financing. The existing debt has to have been in place for at least 2 years, with a clean 12 month payment history. In most circumstances or situations, multiple notes can be combined into the refinance project subject to SBA guidelines.

Participating lenders receive automatic CRA Credit for participating in the 504 Loan Program.

SBA is expected to add a 25 year fixed rate option in 2018. Look for the announcement in future EDF newsletters.

Effective January 1, 2018, SBA released SOP 50 10 5(J). There are quite a few changes that cover topics such as franchise agreements, appraisals, borrower contribution for special purpose properties, etc. EDF would love to set up a time to meet with your lenders to discuss the changes personally. To set up a time, please call Kyle Wilson at (616) 323-1272 or you may send an email to Kyle@growmichigan.com .

Lender Leader Board

EDF would like to thank all of the lenders that have had loans authorized with us so far this fiscal year. At the end of our fiscal year (9/30/18), the lending institution with the most loan approvals will receive our Lender of the Year Award.

T raverse City State Bank

4 Loan

Huntington Bank

3 Loans

Chase Bank

1 Loan

Comerica Bank

1 Loan

Grand River Bank

1 Loan

Honor Bank

1 Loan

Mercantile Bank

1 Loan

The Bancorp

1 Loan

Union Bank

1 Loan

West Michigan Community Bank

1 Loan

West Shore Bank

1 Loan

FY 2018 Total

Totals as of 12/31/2017

16 Loans

The Lenders Cup

All of the lenders listed above, along with any other bank or credit union that has a project authorized by EDF prior to September 1, 2018, will be eligible to compete in The Lenders Cup Golf Tournament! Last year was our inaugural event and the traveling trophy went home with Traverse City State Bank! This year's event will take place on September 13, 2018 at Thornapple Pointe Golf Course . Each lending institution will have the opportunity to submit a foursome to compete.

Featured 504 Funding

K & T Tool and Die

Bradd Pierce, EDF Senior Loan Officer, teamed up with Mark Martis, Grand River Bank’s Chief Lending Officer, to provide SBA 504 financing for K & T Tool and Die, Inc.

K & T saw an opportunity to bring some of the work it had been outsourcing in recent years in house, and they were able to capitalize on the low down payment and long term financing features of the 504 Loan Program. Additionally, they were able to place the real estate purchase, renovations and equipment into a 50% bank loan and 40% debenture financing package. The result is a 20 year fixed interest rate for a portion of the loan, and greater efficiencies for the company as a whole to help them achieve even greater success in the coming years.

K & T Tool and Die, Inc. located in Rockford, Michigan is a full service tool and die shop specializing in small to medium progressive dies. It was formed in 1992 and purchased in July 2015 by the current owners, Ed Talcott, James Bristol, and Klint Beck who were employees of the previous owner.

"K & T Tool and Die looked at several options when deciding how to finance our growth. Other finance institutions told us, how a conventional loan would better suite our requirements. In my opinion, the other banks really did not understand what we needed. Grand River Bank, with the help of Mark Martis, recognized that we had limited resources and recommended that we should look at the 504 program. With the help of EDF we utilized the benefits of the 504 program. Although, more paperwork was required, EDF made it as easy as possible. They provided the forms and knowledge on how to best process the documents. Not only were we able to finance our building with 10% down we were able to include financing for some critical machinery required for our growth," said Ed Talcott.

To learn more about the benefits of the SBA 504 Loan Program, or how EDF can assist you, please visit our website at www.growmichigan.com , or call one of our Loan Officers Gary Witkowski or Bradd Pierce .

Call EDF for your 7(a) Packaging Needs

EDF can assist your bank or credit union with 7(a) Loan eligibility and questions. We can also prepare loan applications and submit them directly to the SBA for approval. If you do not have an in-house SBA specialist, please consider using EDF . For more information, please call Amy Dubridge at (616) 323-1279 or you may send an email to Amy@growmichigan.com .

Schedule a Lunch and Learn

EDF would love the opportunity to bring lunch to your organization, get to know your entire team, and do a brief presentation on the benefits of the 504 Loan Program. We are currently scheduling into March and April. If you would like to set up a time, please call Kyle Wilson at (616) 323-1272 or you may send an email to Kyle@growmichigan.com .