The U.S. Small Business Administration said Tuesday that it has received additional funding to support $4.5 billion in enhanced small business lending through Feb. 28.
Federal stimulus funding that let the SBA increase its guarantee and lower fees on its two most popular loans ran out Nov. 23. As of Tuesday, 1,070 small businesses were waiting to borrow $562 million, according to the SBA’s Web site.
President Barack Obama signed an appropriations bill Saturday that included $125 million to extend the SBA’s enhanced loans.
The SBA plans to begin new loan approvals by Monday. It first will fund applications in its Recovery Loan Queue, which began Nov. 23 for small businesses that wanted an enhanced loan and could wait for funding.
As part of the federal stimulus package, the SBA received $375 million to increase the guarantee on its 7a loans to 90 percent from 75 percent and to waive borrower fees on 7a and 504 loans.
Since February, the funding supported more than $16 billion in SBA loans nationwide.
The SBA’s Dallas-Fort Worth office approved 1,327 loans amounting to $541.7 million from February through last Friday. The extended loan programs “mean thousands more small business owners have access to the credit they need,” said SBA Administrator Karen Mills. She said she’ll continue to work with Congress to meet Obama’s goal of giving small businesses more access to credit to help drive the U.S. economic recoverythrough job creation.
The extension doesn’t affect the SBA’s America’s Recovery Capital loan program, microloans, or 7a and 504 loans with standard guarantees and fees.
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Good article and good news for many. However, not every small business can qualify for a bank loan (and still won’t even with these changes). There are other options, one being a business cash advance. It’s cash given up front to businesses when they need it. Depending on how much monthly revenue the business brings in, they don’t have to make monthly payments like with small business loans; instead small debits are automatically taken from batched credit card sales which makes repaying the money much easier. It’s also a great cash securing method for businesses who can qualify for traditional loans, it’s really an overlooked method that works great for any business.
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