September 2006  Issue No. 24                    REAP HOME PAGE         A publication of the Center for Rural Affairs

Rural Enterprise Reporter

Direct Loan Program Has Excellent Year Helping Businesses
REAP loaned $380,560 in direct loans and leveraged close to $1.4 million small business capital through cooperative agreements

The REAP Direct Loan Program had an excellent year in 2006. REAP saw in 1998 the need to serve businesses that had used the REAP Peer Loan Program but had grown beyond those loan levels. REAP also had new microentrepreneurs with needs beyond those that could be met by Peer Loans. The REAP Direct Loan Program was created to serve these entrepreneurs.

The REAP Direct Loan Program became a permanent part of REAP in 2000. In the past fiscal year, REAP placed 41 Direct Loans totaling $380,560. These loans and extensive client technical assistance also leveraged over $1,398,250 in additional debt financing from traditional lenders, other revolving loan funds, and private sources during this time period. Since inception of the Direct Loans, REAP has placed 209 Direct Loans totaling $2,660,818.

The REAP Direct Loan Program is helping to leverage other funds. As part of REAP’s technical assistance services, REAP provides business planning services to REAP members. These services have resulted in leveraged lending in many instances.

There have been many cases where a REAP client has completed their business plan in consultation with their area REAP Business Specialist and have been able to secure a loan from a traditional lender, development district, community action agency, or a local loan fund.

REAP staff have also helped in “packaging” loans that would include other lenders in addition to REAP’s loan fund. Historically, REAP has “leveraged” loans totaling $7,050,655.

REAP continues to be extremely satisfied with the performance of these loans. Microbusinesses have microloan needs as small as $100 to as large as $25,000 or more.

It has always been REAP’s goal to meet the debt financing needs of all members – individually or by collaborating with partners. The REAP Direct Loan Program is meeting this need most effectively.
We look forward to adding additional lending products to our current product mix in the future. View the current REAP lending products .

Contact: Jeff Reynolds, REAP Program Director at 402.656.3091 or jefff@alltel.net for more information.

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