Maryland Resource-Based Industry Financing Fund (MRBIFF)
The MRBIFF Loan Program is available as a Direct Lending program or a Participation Loan program. Both MRBIFF programs offer low-interest loans to agricultural/RBI-industry enterprises to purchase land and capital equipment for production and processing activities.
NOTICE TO LENDERS AND PROSPECTIVE APPLICANTS:
The Participation Loan option is currently offered through Horizon Farm Creditand Colonial Farm Credit. If other lenders are interested in adopting this lending approach, please contact MARBIDCO.
MARBIDCO currently accepts applications under both the direct lending program and the participation loan program. Call 410-267-6807 or email bcadden@marbidco.org for more information.
Commercial Lender Is Required
Direct Loan Maximum Loan Amounts
Real Estate, poultry house construction - $600,000
Equipment/fixed assets - $300,000
Large-scale food/fiber processing projects - $1,000,000 (but not more than 25% of the project cost)
Direct Loan Structure: MARBIDCO can provide supplemental loan proceeds ranging from 20% to 40% of the total commercial financing needed, in collaboration with a commercial bank and/or a public-sector lender. (Illustration: If a bank is willing to loan $60,000 for a $100,000 business activity contingent on MARBIDCO’s participation, MARBIDCO may loan up to an additional $40,000 for such a project.) A 50/50 participation is possible under extraordinary circumstances.
Participation Loan Maximum Loan Amounts
Real Estate, poultry house construction - $700,000
Equipment/fixed assets - $350,000
Large-scale food/fiber processing projects - $1,000,000 (but not more than 25% of the project cost)
Participation Loan Structure: MARBIDCO's share ranges from 30% to 49%, while the Lender's share ranges from 51% to 70%. Regarding collateral security for the Participating Loan, the exact terms governing the handling of security interests will be specified in an executed master inter-creditor agreement. Still, ordinarily, MARBIDCO’s credit loss risk will be greater than the Lead Lender’s in the event of a default.
Loan Terms and Conditions
MARBIDCO Interest Rates:
Direct loan - 4.75% for the first 3 years, 5.25% for the next 3 years, and 5.75% for the remaining term of the loan. MARBIDCO will charge a loan origination fee of 1% of the direct loan amount.
Participation loan - 4.25%, and the primary lender may require a loan servicing fee of up to 0.75% (maximum 5.00% for the full term of the loan)
Loan terms:
The MRBIFF direct loan program has a term of 5 to 7 years. Land is 10 to 30 years (typically with a 10-year balloon).
The MRBIFF participation loan program aligns with the partnering lender’s terms, including a mandatory 15-year MARBIDCO balloon payment.
Application Submission Process
All MRBIFF loan applications will be developed and submitted to MARBIDCO by a commercial bank or Farm Credit Association loan officer (possibly in consultation with other rural business advisors) and/or a Farm Service Agency representative.
MARBIDCO will make and service its loans in the direct loan program.
The lender will make, service, and close all loans with their documentation in the Participation Loan.
Email completed applications to Brian Cadden at bcadden@marbidco.org or mail to Loan Programs, c/o Brian Cadden, 1410 Forest Drive, Suite 21, Annapolis, MD 21403
Equity Requirement - Direct Loan
Typically, 10% of a project’s total cost (Can be less for young/beginning farmers; poultry projects may not exceed a maximum combined loan-to-value of 92%.
Equity Incentive Program
The partnership program below works in tandem with MARBIDCO and is designed to incentivize farmers in Cecil, Kent, and Queen Anne's counties on the Eastern Shore to request loans.
Each MARBIDCO loan program has its own eligibility criteria and an application/approval process.
The Upper Shore Regional Council Farm Loan Equity Incentive Matching Fund will contribute up to $15,000 toward an MRBIFF Program loan, and in all other loan programs, the equity incentive match will be capped at $5,000 (per applicant). A 5% borrower equity match is generally required to obtain the incentive funds. To learn more, click on the box below :
If you are a Farm Credit loan officer seeking more information about the MRBIFF Loan Participation program, please reach out to bcadden@marbidco.org for more information. Or call (410) 267-6807.