This release applies to all credit unions, state or federal, making loans for business purposes.
Loans with the following characteristics are usually considered commercial loans:
- Repayment relies on revenue from a business or appreciation and resale of that business (i.e., collateral-based lending);
- Security for the loan is a business asset (such as a vehicle titled in the business’ name);
- Purpose is to obtain a business or business asset;
- Proceeds are used to finance business operations; or
- Member business loans as defined by state or federal credit union rules.