Sample Bank Letter Of Commitment Template printable pdf download

Sample Bank Letter of Commitment

SBA 504 program

Date

Name of CDC contact

Title of CDC contact

Name of CDC

Address of CDC

City, State Zip Code

RE:

Name

Address, City, State

Dear [name of CDC contact]:

[Insert Name of Lender] has reviewed the borrower’s application for a $

loan for

full project financing for the purchase and improvements of the real estate located at [insert

address, city, state]. This Bank is not in a position to meet the borrower’s request for full

project financing at this time as the loan maturity exceeds our credit policy. To the best of our

knowledge, financing of the total project cost is not available at interest rates and terms

prevalent in our community.

[Insert Name of Lender], however, is willing to participate with [insert name of CDC] in the

SBA 504 loan program to benefit [Insert Name]. In this connection, the Bank's $

loan

(50% of Project Cost) would have an initial rate of interest at [insert interest rate]. The note

will be for a term of [insert term] to be fully amortized over the loan term. This loan is to be

secured by a first security lien on the subject real estate.

In addition, [Insert Name of Lender], is willing to provide an interim loan in the amount of $

(40% of the Project Cost) to be repaid from the proceeds of the debenture sale. This interim

loan is to be secured by a second security lien on the subject real estate. In addition, the SBA

approval of this loan is conditioned upon the receipt by SBA from Bank of a one-time

participation fee equal to one-half of one percent of the principal amount of the Bank loan

attributable to the 504 project that is senior to SBA (currently waived under ARRA). This is

conditioned on the final Bank approval as well as the approval by the Small Business

Administration.

Sincerely,

Name of Lending Official

Title

Sample Bank Letter Of Commitment Template