The Regional Development Alliance, Inc. is a non-traditional business lender located in eastern Idaho. Our objective is to directly invest in qualified businesses in order to obtain a reasonable return on our investment, increase job growth, and retain quality jobs.
Service Area
Our service area consists of seven counties in eastern Idaho including Bannock, Bingham, Bonneville, Butte, Custer, Jefferson, and Madison. Although we typically invest within these seven counties, we will consider opportunities outside of the region where such opportunities will bring significant economic impact to the seven-county region or where there is a substantial return on investment to the RDA.
Lending
The RDA does NOT give grants to businesses. The RDA does NOT offer interest free loans.
The RDA is NOT a rapid lender. The process to obtain funding can be lengthy and may take as much as 60 days to finalize a decision, depending on Loan Committee meetings, due diligence and document preparation. If you require funds immediately we would be happy to direct you to other potential options.
The RDA leans toward more conservative investments, but will consider greater risk for investments with higher potential returns.
The RDA considers applications for funding without regard to race, gender, or religion. We will consider any business that meets legal standards and proper and reasonable standards of safety, risk, environment, economic impact and investment return.
Loan Amount
The RDA prefers to lend to a maximum of $500,000, but will from time to time, consider larger amounts where such investments will bring substantial economic impact to the region or a significant return on investment to the RDA. No minimums have been established.
The RDA’s funds are revolving. This means that funds availability varies from month to month. Depending on when you apply, funds may or may not be available.
Down Payment
All applicants are required to provide a MINIMUM of 10% down and may be required to provide up to 20%.
Interest Rate
All interest rates are tied to Prime and will not be less than Prime. Rates may be as high as Prime + 6 depending on risk and/or the opportunity for return on investment.
Terms
Terms will not exceed 10 years, but we will consider amortizing past the 10-year term with a scheduled balloon payment at the end of the maximum 10-year period in order to reduce payment amounts in the early years. In no case will the 10-year term be extended.
Collateral
Collateral must be adequate for the amount and use of loan proceeds.
Risk
All appropriate instruments will be applied to mitigate risk including but not limited to collateral, key person life insurance, liens, and personal and corporate guarantees.
RDA requires principal owners and shareholders of non-public corporations to sign unlimited personal guarantees for approved loans.
Reporting
All awards will require some reporting responsibilities on a quarterly basis. Failure to comply with reporting requirements will be deemed a default under contract provisions and the entire amount of any dollars previously awarded plus interest may be required to be returned to the RDA immediately upon notification.
Fees
A 2.0% origination fee and a 0.5% servicing fee are charged on all loans (totaling 2.5%). In most cases borrowers will need to pay the fees upfront at time of closing or have fees withdrawn from the loan proceeds. In some cases, the fees may be added into the loan, amortized and included in the monthly payments.
Retail Business
Retail loans are limited only to the following rural communities: Aberdeen, Arco, Challis, Downey, Lava Hot Springs, Mackay, Mud Lake, Stanley, Terreton. The proposed business must be a benefit to the community. We will not fund one retail business that will directly cause another to fail.
Confidentiality and Nondisclosure Agreements
The RDA takes every precaution to ensure that the proprietary information presented in applications and presentations is protected. Presentations are private and any information left in our possession will be shredded. However, the board of directors and staff do NOT sign confidentiality and nondisclosure agreements and will not be held liable for exposure of such information once presented. All board members have signed conflict of interest statements and work under the requirements outlined in those statements.