What is the purpose of the Main Street lending program?
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What is the purpose of the Main Street lending program?
The Federal Reserve established the Main Street Lending Program (Program) to support lending to small and medium-sized for profit businesses and nonprofit organizations that were in sound financial condition before the onset of the COVID-19 pandemic.
What are the terms of the Main Street lending program?
The Main Street Lending Program offers three different secured or unsecured 5-year term loan options set at an adjustable rate of LIBOR (1 or 3 month) plus 300 basis points with principal deferred for two years and interest payments deferred for one year for eligible borrowers.
Was the main street lending program extended?
In order to allow more time to process and fund loans that were submitted to the Main Street lender portal on or before December 14, 2020, the Federal Reserve Board on Tuesday extended the termination date of the Main Street Lending Program facilities to January 8, 2021.
How many main street loans have been made?
400 loans
To date, the Main Street program has made almost 400 loans totaling $3.7 billion, providing support to businesses from a wide range of industries. The program was established with the approval of the Treasury Secretary and with $75 billion in equity provided by the Treasury Department from the CARES Act.
Can you get PPP and Main Street loan?
In order to be an “eligible borrower” the individual or entity must have been established prior to March 13, 2020 as a for-profit “business” that would be eligible to borrow money under the PPP. …
How do you qualify for the Main Street lending program?
Borrower Eligibility
- (1) The business must meet at least one of the following two conditions: (i) the business has 15,000 employees or fewer, or (ii) the business had 2019 annual revenues of $5 billion or less.
- (2) The business must have been established prior to March 13, 2020.
- (3) The business must be a US business.
When did the Main Street lending program start?
The Federal Reserve published draft terms for Main Street on April 9, 2020, and the program started purchasing loan participations on July 6, 2020, with the goal of supporting lending to a wide range of small and medium-sized businesses that were in sound financial condition before the onset of the COVID-19 pandemic.
Can Main Street loans be used for acquisitions?
Main Street loan proceeds can be used for a wider set of business purposes, including to purchase business assets and even for acquisitions of other companies and businesses.
Does Main Street loan require personal guarantee?
The term sheet dated April 30, 2020 language suggests that the loans being refinanced must be owed to a lender that is not the eligible lender of the MSLP loan. Is a guarantor required? No, a personal guarantee is not required.
Are Main Street loans forgivable?
Main Street Program: The Federal Reserve designed the Main Street Program to support small and mid-sized businesses and nonprofits that were unable to access the PPP or that require additional financial support after receiving a PPP loan. Unlike PPP loans, loans issued under the Main Street Program are not forgivable.
Are Main Street loans secured?
Main Street loans may be secured or unsecured, but certain priority rules apply in the event the borrower has other outstanding debt: Priority Requirements for MSNLF (“New Loan Facility”) Loans – MSNLF loans may not be expressly “contractually subordinated” to the borrower’s other debt.
How do you get approved for the Main Street lending program?
Borrower Eligibility
- (1) The business must meet at least one of the following two conditions: (i) the business has 15,000 employees or fewer, or (ii) the business had 2019 annual revenues of $5 billion or less.
- (2) The business must have been established prior to March 13, 2020.
- (3) The business must be a US business.