Revolving Loan Fund

The NOFA Vermont Revolving Loan Fund was jointly established in 1994 by NOFA Vermont and People's United Banl (formally Chittenden Bank's Socially Responsible Banking Fund). NOFA Vermont manages the $90,000 fund. The motivation to create the fund arose from an increasing number of loan requests from small scale organic farmers; farmers who lack credit history and therefore could not secure conventional loans; and the need for short-term working capital.
 

Process and Timeline:

Completed applications are accepted on a rolling basis. Technical assistance is available from the NOFA Vermont office for applicants who need help developing a business plan or in completing their loan application. Contact the office at (802) 434-4122 or [email protected].

Applications are reviewed by a peer loan fund advisory board. An initial screening will take place and applicants who are declined at this point will be notified. The applicants who are still in the selection pool may get a site visit by the loan fund officer after an initial screening is completed. Final decisions will be made by the loan fund advisory board. The loan fund will conduct a credit history check at its own expense.
 

    General Information for borrowers:

    This information can also be found as a downloadable PDF here

    Eligibility

    Loans are available to:

    • farmers within Vermont
    • farmers that farm with sustainable agricultural practices
    • organic farmers
    • farmers that are interested in making the transition to sustainable management practices
    • farmers that are interested in making the transition to organic management

    Permitted Use of Funds

    • Equipment and long-term assets (such as tractors, greenhouses, building improvements, or breeding or market livestock that will be on farm for more than one year)
    • Working capital and short-term assets (such as inventory, advertising, seeds, market livestock to be processed within one year, or wages for production of product that will be sold during the year)
    • Improvement of business management (such as market research, computer software and training, or seasonal labor)

    Loan Amount

    • $2,000 - $15,000

    Rate

    • Fixed rate of 5.75%. Terms and disclosures will be detailed in the commitment letter.

    Terms

    • Equipment loans - 1 to 5 years
    • Working capital - 1 to 12 months
    • Business management - 1 to 12 months

    Note: There is no pre-payment penalty for the payback of loans.

    Collateral

    • Loans under $2500 will be unsecured
    • Loans of $2500 or higher must be secured with a minimum loan to value ratio of 90%.
    • Value of the collateral will be assured by appraisal by the loan officer or an independent third party.

    Equity Requirements

    A minimum of 10% equity in the project is required on loans of $2500 or greater.
     

    Application Details:

    Please read our Loan Fund Letter before completing the application. The letter can be found here.  

    To apply for the NOFA Vermont Revolving Loan Fund, please submit to following information to the NOFA Vermont Office, Attn: Jaime Silverstein, PO Box 697, 14 Pleasant Street, Richmond, VT 05477, or by email [email protected]:

    • A description of your loan request, including: desired loan amount, how the loan will be used (in dollar amount), how much the whole project will cost and anticipated additional sources for financing, length of loan, and how the loan will be beneficial to your business.
    • A one page business description, including location, type of business, years in business, marketable products and where sold, number of employees, gross sales, physical plant (land, house, barns, greenhouses, livestock inventory, etc.) and other relevant information.
    • Personal Data Sheet (or Joint Applicant Personal Data Sheet if applicable)
    • Trade reference sheet. For applicants who are not able to provide three recent trade references, please send in three letters of reference.
    • A projected budget for the upcoming production season of sales and categorized expenses for your whole business, a current balance sheet listing assets, liabilities and net worth, and a projected twelve month cash flow of gross sales, and expenses if available. Other supporting information for your loan request is helpful, such as crop enterprise budgets.
    • The last three years federal tax forms.
    • Credit Report - This can be downloaded at https://www.transunion.com/.