Loan Guarantees

The Northland Foundation guarantees business loans originated by banks on behalf of applicant businesses that the Northland Foundation deems creditworthy. A bank provides a commercial loan, and the Northland Foundation guarantees a portion of the loan against deficiency.

The program is intended to increase the availability of bank credit that, based on normal bank underwriting criteria, may not otherwise be extended to an applicant. Businesses that are newer, have thinner collateral margins, or hold high debt-to-worth ratios are among the candidates for this product.

• Guarantee amounts and percentages are negotiated with the bank and the borrower. The maximum guarantee available equals 80% of the bank loan balance, up to $80,000.
• Terms and conditions of the guarantee, such as size, amount, and any fees involved, are primarily negotiated between the Northland Foundation and the originating bank.
• Financing terms such as interest rate, term, and collateral are primarily a matter of negotiation between the applicant and the originating bank.