Improved Commercial Loan Insurance Programs Make It Easier and Faster to Do Business in Maine
The Finance Authority of Maine (FAME) is pleased to announce new and improved commercial financing options and fees. The changes result from input by FAME’s lending partners and the agency’s desire to better serve its customers. The changes take effect today.
Last year, FAME embarked on a collaborative process with its lender partners to discover what programs and enhancements would help them better serve their customers, Maine businesses. The results of that work are three new enhancements to FAME’s loan insurance programs that help lenders obtain loan insurance decisions faster, more easily, and most often at a lower cost.
Beginning November 1, 2016, FAME lender customers can opt to use:
- NEW 3- and 5-year fee options for term loan insurance;
- New 3-year fee option for line of credit loan insurance;
- Leveraged insurance in the OnLine Answer (OLA) application process.
“FAME listened and responded to what our lending partners had to say regarding how we might improve our loan insurance offerings,” stated Bruce Wagner, FAME Chief Executive Officer. “We are pleased to announce these changes, which should help our lending partners obtain financing from us faster, more easily, and most often at a lower cost.”
Commercial Loan Insurance Now Available in One, Three and Five Year Fee Options
A lender now can choose the amount of time they want to insure a loan, and pay FAME fees once, up-front for these multiple year options. FAME historically only offered an annual insurance fee paid at each renewal. As of November 1, 2016, FAME is adding three- or five-year options for term loan insurance and a three-year option for loan insurance on lines of credit. These options are available for insurance offered both through the traditional and OnLine Answer (OLA) application processes. Fees for multi-year options are offered at a discount to the annual option. The lending institution may add these fees to the principal amount of the loan, at the time of loan closing, if desired.
Leveraged Insurance Option Now Available for OnLine Answer (OLA)
Since its inception in 2006, only pro-rata insurance has been available through OLA. Starting November 1, 2016, lenders can apply for leveraged loan insurance on term loans of up to 25% of the original loan balance (20% on lines of credit), up to $250,000 of FAME exposure.
FAME’s aggregate exposure per borrower in OLA will continue to be $375,000. This can be a combination of pro-rata and leveraged insurance, with a $250,000 limit on leveraged insurance.
Interested lenders should contact a FAME loan officer or examine FAME’s new fee schedule by visiting www.FAMEmaine.com/business for assistance with determining whether leveraged or pro-rata insurance is right for them.