Down payments can be a burdensome outlay for businesses that are investing in real estate, machinery and equipment, or tourist-travel recreation projects. Companies that make a smaller down payment (usually less than 20% of the sale price) require mortgage insurance that protects the lender if the company defaults on that mortgage. While no company would foresee defaulting, mortgage insurance protects the financial ecosystem in the state. Commerce Corporation staff can outline the in-state mortgage insurance program for qualifying companies.
Mortgage insurance is offered through the Rhode Island Industrial Recreational Building Authority (IRBA). The maximum amount a business can borrow through this program is $5,000,000. The loan covers up to 90% on real estate, 80% of machinery and equipment, and 75% of tourist-travel recreation projects. Funds can be used for new building acquisitions, additions and rehabilitation of existing buildings and for new or used machinery and equipment. This program offers borrowers debt insurance on tax-free bonds, taxable bonds and conventional mortgages.
The Commerce Corporation staff can walk companies through eligibility criteria, from dollar limits per project to approved use of funds and forms of financing.