# 7 CFR § 1980.420: Loan guarantee limits

> Federal · Regulations · In force

URL: https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.420

## Section

- **Citation:** 7 CFR § 1980.420
- **Heading:** Loan guarantee limits
- **Jurisdiction:** Federal
- **Kind:** Regulations
- **Status:** In force
- **Text as of:** September 22, 2026
- **Source:** Publisher's official text
- **Location:** Title 7—Agriculture > Subtitle B—Regulations of the Department of Agriculture > CHAPTER XVIII—RURAL HOUSING SERVICE, RURAL BUSINESS-COOPERATIVE SERVICE, AND RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE > SUBCHAPTER H—PROGRAM REGULATIONS > PART 1980—GENERAL > Subpart E—Business and Industrial Loan Program

## Text

The percentage of guarantee, up to the maximum allowed by this section, is a matter of negotiation between the lender and Rural Development.
(a) For loans of $2 million or less, the maximum percentage of guarantee is 90 percent.
(b) For loans over $2 million but not over $5 million, the maximum percentage of guarantee is 80 percent.
(c) For loans in excess of $5 million, the maximum percentage of guarantee is 70 percent.
(d) Lenders and borrowers will propose the percentage of guarantee. Rural Development informs lenders and borrowers in writing on Form RD 449-14 of any percentage of guarantee less than proposed by the lender and borrower, and the reasons therefore. Rural Development determines the percentage of guarantee after considering all credit factors involved, including but not limited to:
(1) Borrower's management. The borrower's management, and when appropriate, equity capital, history of operation, marketing plan, raw material requirements, and availability of necessary supporting utilities and services;
(2) Collateral. Collateral for the loan;
(3) Financial condition. Financial condition of borrower or borrower's principals, if appropriate;
(4) Lender's exposure. The lender's exposure before and after the loan, and any applicable limits on the lender's lending authority; and
(5) Trends and conditions. Current trends and economic conditions.

## Nearby sections

- [7 CFR § 1980.401 § 1980.401 Introduction.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.401.md)
- [7 CFR § 1980.402 § 1980.402 Definitions.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.402.md)
- [7 CFR § 1980.403 § 1980.403 Citizenship of borrowers.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.403.md)
- [7 CFR § 1980.405 § 1980.405 Rural areas.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.405.md)
- [7 CFR § 1980.411 § 1980.411 Loan purposes.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.411.md)
- [7 CFR § 1980.412 § 1980.412 Ineligible loan purposes.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.412.md)
- [7 CFR § 1980.413 § 1980.413 Transactions which will not be guaranteed.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.413.md)
- [7 CFR § 1980.414 § 1980.414 Fees and charges by lender and others.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.414.md)
- [7 CFR § 1980.419 § 1980.419 Eligible lenders.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.419.md)
- [7 CFR § 1980.420 § 1980.420 Loan guarantee limits.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.420.md)
- [7 CFR § 1980.423 § 1980.423 Interest rates.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.423.md)
- [7 CFR § 1980.424 § 1980.424 Term of loan repayment.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.424.md)
- [7 CFR § 1980.425 § 1980.425 Availability of credit from other sources.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.425.md)
- [7 CFR § 1980.432 § 1980.432 Environmental review requirements.](https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.432.md)

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/ecfr-7-1980.420. Check the current official text before relying on it. Not legal advice.