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The Loan Participation Program provides long-term financing to Alaska businesses for new or existing projects, or for the refinancing of existing loans. The Loan Participation Program has been highly successful since its inception in the early 1980’s. This program has helped diversify the Alaskan economy by providing financing for a large variety of commercial facilities ranging from office buildings, warehouses and retail establishments to hotels, fishing vessels and manufacturing facilities.
AIDEA is not a direct lender, but through the Loan Participation Program, AIDEA purchases a portion of a loan that is sponsored and originated by an eligible financial institution. In most cases the interest rate on the AIDEA portion of the loan is slightly lower than the rate on the bank’s portion. The term of the AIDEA portion of the loan can also exceed the term of the bank portion. This can result in lower scheduled payments for the borrower.
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Furniture Enterprises of Alaska, Inc
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Pt. Sophia Tourist Destination Project
How to Apply
The first step is to contact one of AIDEA’s eligible financial institutions.
- The financial institution, after its approval of the loan, applies to AIDEA for participation in the loan.
- AIDEA loan officers underwrite the financial institution's loan package.
- The loan is submitted for approval to the AIDEA Credit Review Committee. If the AIDEA participation equals or exceeds $3 million, the loan must also be approved by the AIDEA Board of Directors.
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Highlights of the Program
AIDEA provides fully amortizing, long term financing. (Up to 15 years for personal property or 25 years for real property; the maximum loan-to-value is 75%.)
- AIDEA offers either a fixed or variable interest rate.
- The term of the AIDEA portion of the loan can exceed the bank’s term, thereby lowering the scheduled payments.
- AIDEA provides a secondary long-term market for eligible financial institutions.
- The originating financial institution retains a portion of the loan and also services the entire loan (i.e., payments are made to the bank, not to AIDEA).
- The project must be in Alaska.
Pt. Sophia Tourist Destination Project
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Costs
A $1,000 non-refundable application fee is due at the time the financial institution submits the loan package for AIDEA consideration. The application fee is credited toward the one percent commitment fee if the borrower accepts a written commitment issued by AIDEA.
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For more information contact:
Chris Anderson, Deputy Director-Credit
907.771.3030 Email: canderson@aidea.org
Bruce Chertkow, Loan Officer
907.771.3037 Email: bchertkow@aidea.org
Leona Hakala, Loan Officer
907.771.3032 Email: lhakala@aidea.org
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