When should a bank loan be considered in place of a bond issue?
Local banks may be interested in loaning funds to the district if the amount is small and the term is relatively short. Amounts under $1 million and terms less than 10 years are often considered by banks for their portfolios. Rates tend to be higher Fees tend to be lower Prepayment often allowed at minimal cost Recommendation: Contact three to five banks to keep the rates competitive. Call the NHMBB before you award the bid to be sure the rates are reasonable in the current market.
