PIDA Interest Rates – 2019 2nd Quarter

Listed below are the updated interest rate options for the PIDA loan program.  These rates are in effect for loan applications received through June 30, 2019.

For Real estate loans financing eligible land and building costs, borrowers will have the following interest rate options:

For term loans with a regular amortization;

  1. Fixed interest rate for the full term of the loan (up to a 15-yr. period), set at the current 10-year treasury yield + 100 basis points.  Based on the current 10-year treasury yield, the fixed rate option is 3.50% for the life of the loan.
  2. Fixed interest rate for a seven (7) year period set at the 10-year treasury yield.  After seven years, the rate will reset to the then-current 10-year treasury yield.  Please note, the reset rate is limited to a 200 basis point increase/decrease.  The reset rate is then fixed for the duration of the loan.  Based on the current 10-year treasury yield, the rate for the initial (7) year period is 2.50%.

For 10-year term loans with a 20-year amortization period;

  1. Fixed interest rate for the full term of the loan (10-yr. period). This option is calculated using the 10-year treasury yield +100 basis points.  Based on the current 10-year treasury yield, the fixed rate option is 3.50% for the life of the loan.
  2. Fixed interest rate for a five (5) year period set at the 10-year treasury yield.  After five years, the rate will reset to the then-current 10-year treasury yield.  Please note, the reset rate is limited to a 200 basis point increase/decrease.  The reset rate is then fixed for the duration of the loan.  Based on the current 10-year treasury yield, the rate for the initial (5) year period is 2.50%.

For Equipment loans – 3.50% fixed rate for the full term of the loan.

For Working capital and accounts receivable lines of credit – 3.50% fixed rate for 12 month period.

For Pollution prevention and energy efficiency loans – 2.00% fixed rate for the full term of the loan.

The current guidelines for the PIDA program can be found here: https://dced.pa.gov/programs/pennsylvania-industrial-development-authority-pida/

Montgomery County Economic Development Financing

Montgomery County Opportunity Loan Program – 2018 Guidelines

Updated guidelines for the Montgomery County Opportunity Loan Program (MCOLP) have been released. As the Commerce Department’s flagship economic development program, the Montgomery County Opportunity Loan Program (MCOLP) is a cooperative initiative of the County government, the Montgomery County Development Corporation (MCDC), and the Montgomery County Industrial Development Authority (IDA). The loan program offers fixed rate and term loans to help businesses grow, increase productivity, and maximize the value of their investments in Montgomery County, Pennsylvania.

MCOLP is designed to be utilized as a traditional economic development “gap financing” tool in conjunction with commercial lenders as well as other public sector and non-profit sector lenders. Successful applicants will work with the Commerce Department and other lending institutions to fund a project (such as an equipment purchase or a building expansion). The advantages of utilizing MCOLP funding as part of a project’s funding include a reasonable fixed rate and term.

To download the new guidelines, visit: https://www.montcopa.org/1713/Loan-Program