Ala. Admin. Code r. 108-1-3-.02

Current through Register Vol. 43, No. 1, October 31, 2024

Section 108-1-3-.02 - Commodity Barn Loan Program

Funds may be loaned by the authority to a borrower under the Commodity Barn Loan Program if the borrower is engaged in agricultural operations in this state and will use the borrowed funds to purchase agricultural commodities in bulk to realize savings in the purchase of those agricultural commodities and those agricultural commodities will be used by the borrower for borrower's agricultural operations in this state.

(a) Applicants are subject to a $50 loan

(b) All borrowers seeking loans under this rule are subject to credit checks by the authority.

(c) Loans issued pursuant to this rule are made in the following amounts:

(i) $7,500;

(ii) $15,000; or

(iii) $22,500

(d) An inspection of applicant's agricultural operation by an authority representative is required prior to loan approval.

(e) All amounts borrowed under this rule shall be repaid to the authority, plus interest at the applicable rate, no later than 3 years from the date loan proceeds are issued to the borrower.

(f) Interest charged on funds borrowed under this rule is 3%.

(g) All borrowed amounts must be fully collateralized.

(h) All loans issued pursuant to this rule require personal guaranty by an individual with sufficient assets to fully satisfy the borrowed amount in the event of default.

(i) The authority reserves the right to deny any loan application.

Ala. Admin. Code r. 108-1-3-.02

Adopted by Alabama Administrative Monthly Volume XXXV, Issue No. 07, April 28, 2017, eff. 5/20/2017.

Author: Alabama Agricultural Development Authority

Statutory Authority:Code of Ala. 1975, § 2-3A-7.