More Help on the Way for Small Businesses
Dec 15th, 2010 @ 2:46 PM by Amber Nelson
According to an article on CNNMoney.com today, the Small Business Administration has just announced two new loan programs designed to make cash available for small businesses quickly.
“Many entrepreneurs and small business owners across the country have enormous potential to drive economic growth and create good-paying jobs in their local communities, but too often they face barriers in fulfilling that potential,” said Catherine Hughes, chairperson of the SBA’s new Advisory Council on Underserved Communities.
The first program is call the Small Loan Advantage allows small business owners to apply for loans up to $250,000 with a much shorter application of just one or two pages. The turn around time is supposed to be fast, with loans submitted online getting approved in just minutes and all others could be approved in just one business day. These applications must be made with one of the 630 flagship 7(a) lending partner banks around the country though.
The streamlined application process will hopefully overcome complaints from lenders that low-dollar loans are not worth their time, one of the reasons small business loans have continued to suffer even as the financial markets have started to recover.
The second programs is called Community Advantage and provides greater access to SBA-backed loans for underserved communities, including businesses owned by minorities, women and veterans, and those in low-income and rural areas. This will be a three-year pilot program that will not go through traditional banks, but micro-lenders, nonprofit Certified Development companies and Community Development Financial Institutions.
“We are taking steps that will increase the number of places small business owners in underserved communities can go to get loans,” said SBA Administrator Karen Mills. “…With Community Advantage, we are making sure that the additional assistance some borrowers may need through counseling and technical assistance will be available.”
Applications for this program should be approved after 5 to 10 days, and both programs are set to begin March 15.
Click here for more information on SBA’s Small Loan Advantage and Community Advantage programs.
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.