Loan Programs
Single-Purpose Animal Facilities Loan Guarantee Program
Description
The Missouri Agricultural and Small Business Development Authority provides a 50 percent first-loss guarantee on loans up to $250,000 that lenders make to independent livestock producers to finance breeding or feeder livestock, earthworms, land, buildings, facilities, equipment, machinery and animal waste systems used to produce poultry, swine, beef cattle, dairy cattle (and other livestock) and earthworms.
How Does the Program work?
Producers wishing to secure a loan through the loan guarantee program must:
- Apply for a loan with an eligible lender
- The participating lender must decide whether a prospective borrower meets its requirements for a loan if a 50 percent first-loss guarantee is provided through the Single-Purpose Animal Facilities Loan Guarantee Program
- After deciding to make a guaranteed livestock loan, the lender must submit an application to the authority
Who Is Eligible?
- A borrower must be a legal Missouri resident who is at least 18 years old
- Borrower must be able to provide proof of citizenship, identity and residence. If the borrower employs laborers, he/she must also provide proof of enrollment and participation in the federal work authorization program.
- An independent livestock producer which is defined as someone engaged in producing poultry, livestock, or earthworms that is either owned or produced under contract, but who is not an integrated producer
- The project must be located in Missouri
Loan Amount and Terms
- Loans made under the guarantee program may be for an amount up to $250,000 with a guarantee available for up to 10 years
- The interest rate charged to a borrower will be negotiated between the lender and the borrower, but cannot exceed the rate normally charged by the lender for similar loans
- A borrower must provide at least 10 percent of the cost of the project
- A borrower must provide a first deed of trust or lien on the financed property to the lender
Restrictions
A borrower cannot be:
- An integrated poultry producer
- An integrated cattle producer with more than 5,000-head feedlot capacity
- A swine producer with more than 1,200 sows. If two or more independent producers organize a networking agreement to produce swine, the 1,200-sow limit would not apply
Fees
At the time of the loan closing, the lender will collect a one-time loan participation fee of one percent from the borrower and pay it to the authority. The lender will also collect a loan guarantee fee of one-half on one percent per annum of the outstanding principal from the borrower and pay it to the authority.
Other Information
Borrowers qualifying for the Single-Purpose Animal Facilities Loan Guarantee Program may also qualify for the BIG MISSOURI Linked Deposit Program administered by the state treasurer’s office. The BIG MISSOURI Linked Deposit Program makes funds available at reduced interest rates to lenders who in turn pass the savings along to agricultural borrowers. To find out more about the BIG MISSOURI Linked Deposit Program, call the state treasurer’s office at (573) 751-2372 or visit their web site at http://www.treasurer.mo.gov.
The authority also administers the Animal Waste Treatment System Loan Program for livestock producers.
Application Information
Single-Purpose Animal Facilities Loan Guarantee Application (pdf)