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Revolving Loan Fund: Key Insights into Its Legal Framework
Definition & Meaning
A revolving loan fund is a financial resource managed by a state, designed to support federal assistance program goals. This fund allows states to lend money to various entities, such as local governments or non-profits, enabling them to undertake projects that align with federal objectives. The funds that remain in the pool, as well as the loans issued, generate investment income. This income is typically required to be used for purposes related to federal assistance programs.
Table of content
Legal Use & context
This term is commonly used in the context of federal and state financial management, particularly in programs aimed at economic development, infrastructure, and community services. Revolving loan funds are often involved in legal practices related to finance, public funding, and grant management. Users may find relevant forms and templates through resources like US Legal Forms to help navigate the processes involved.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
One example of a revolving loan fund is a state program that provides low-interest loans to small businesses for expansion projects. These loans are funded by the state's revolving loan fund and help stimulate local economic growth. Another example is a fund that offers financial support to local governments for infrastructure improvements, such as road repairs or public facility upgrades (hypothetical example).
State-by-state differences
State
Key Features
California
Offers specific revolving loan funds for green initiatives and affordable housing.
Texas
Focuses on economic development through loans to small businesses and agricultural projects.
New York
Includes funds aimed at urban development and infrastructure improvements.
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
Comparison with related terms
Term
Definition
Key Differences
Grant
A sum of money given by an organization for a specific purpose.
Grants do not require repayment, while revolving loan funds do.
Loan
A sum of money borrowed that is expected to be paid back with interest.
Revolving loan funds are specifically managed by states and may have unique purposes.
Common misunderstandings
What to do if this term applies to you
If you are considering applying for a loan from a revolving loan fund, start by researching the specific programs available in your state. Gather necessary documentation and understand the eligibility criteria. You can explore US Legal Forms for templates that can help you prepare your application. If your situation is complex, consider seeking assistance from a legal professional.
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