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Connectivity and infrastructure loans are a term for a group of loans that finance public works projects and communications projects. They aim to encourage projects that benefit the disadvantaged populations in both the United States and throughout the world. The loans can be issued by government organizations and private institutions. To ensure their security, they are often underwritten by local or foreign governments.

Infrastructure Loans

Infrastructure Loans finance the construction, development and improvement of public resources and improve local living conditions. This includes public schools, public housing, roads, dams, sewers, water filtration facilities and electric generators. Infrastructure loans are complex because they involve a wide variety of factors and the risk of loss is quite high. This is why the institution that gives out the loan carefully analyses all the factors involved and tries to account for every possible contingency. As the result, negotiations can take months, even years.

Connectivity Loans

Loans that finance projects that improve local ability to connect and communicate with the rest of the world. This can include building roads, putting together a telephone network or giving the local population computers with wireless Internet routers.

How the Two Overlap

Infrastructure and connectivity projects often go hand-in-hand. For example, a bank may finance a school that comes equipped with computers with up-to-date Internet connections. Infrastructure loans can be used to repair electric towers or add new ones. That is why the line between infrastructure loans and connectivity loans occasionally blurs. Borrowers should carefully negotiate to make sure that the loans cover exactly what they need – no more, no less.

Some important items to know to finance your are:

  1. How much money do you really need?
  2. Do you know your exact FICO scores?
  3. How do you plan to repay the loan?
  4. Who is going to borrow the money? You personally or another legal entity?
  5. What assets can you pledge to secure your loan?

Make sure you know you are pre-qualified before you apply. Our free business capital search engine will allow you to see the funding programs and lenders that are available to you and then you choose those you wish to apply for.

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