This week on The Art of SBA Lending, we explore the world of USDA Business & Industry (B&I) lending, often considered the "last frontier" of government-guaranteed small business finance. Host Ray Drew, who admits to knowing very little about the program, is joined by a panel of USDA experts—Steve Small, Jason Hoerr, and Charles Conoley—to demystify this often misunderstood loan program.

The panel provides a deep dive into the B&I program, which is designed to stimulate economic activity and job creation in rural areas (populations of 50,000 or less). They reveal key advantages over the SBA 7(a), including larger loan amounts (up to $25 million), 30-year terms on real estate, and eligibility for investment real estate and non-profits.

We tackle the common misconception that USDA loans take forever, clarifying that acquisitions can be approved in 2-4 weeks after bank approval. The panel explains why the USDA culture is fundamentally different from the SBA, acting more as a participant in a conventional loan rather than a strict insurer. Finally, we dive into the controversial question: Should the USDA B&I program be absorbed by the SBA?

🎯 In this episode:

• An overview of the USDA B&I program and its mission to create jobs in rural communities.

• Why the USDA guarantee of 80% up to $25 million is a "magic bullet" for rural commercial finance.

• The big cultural difference between USDA and SBA, and why USDA almost never repairs a guarantee.

• The value of a loan packager in navigating the "never-ending" nuances of state-by-state USDA processes.

• The biggest pain points: from outdated environmental regulations to staffing upheaval and inconsistent policy.

💬 Should the USDA B&I program be absorbed by the SBA? Let us know your thoughts in the comments!

🎙This episode is sponsored by:

Lumos

Lumos empowers your small business lending growth with cutting-edge analytics and streamlined applications that optimize your performance.

If you're ready to take your small business lending to the next level with cutting edge analytics visit https://lumosdata.com/

Shatterbox

Learn how Shatterbox can help you hire and invest in bright young talent without breaking the bank. Go to https://shatterbox.io/artofsba and set up a discovery call today.

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