Stage 4: Closing
After weeks or months of document gathering, underwriting, and closing preparation, the B&I loan process ends at the closing table.
The borrower and lender meet (usually remotely, at this point) to sign the final loan documents. These include the promissory note, the loan agreement, security instruments, personal guarantees, and any other documents the lender has prepared. If attorneys are involved in the loan closing, such as for real estate loans in states that require it, both attorneys (lenders and borrowers) will be present.
Once everything is signed, the lender settles the financial side – crediting any excess deposits back to the borrower and collecting the USDA guarantee fee. The loan proceeds are then disbursed, typically within a few business days. For purchase transactions – whether real estate, a business, or equipment – the funds usually go directly to the seller or into escrow. For refinances or working capital, the funds go to the borrower or are applied to the existing debt.
The USDA guarantee is now in effect, and the borrower begins making payments according to the agreed schedule. The B&I loan process is complete.
