Small Business Administration (Administration)
SBA loans are made through banks, credit unions and other lenders who partner with the SBA. Initially the SBA concentrated on providing direct loans to small businesses, guaranteeing bank loans and making loans to victims of natural disasters. Unfortunately, many credit card companies raised rates on business credit cards to compensate. Through the Korean War the Congress created yet one more agency focusing on small business, the Small Defense Plants Administration.
Economic Injury Disaster Loans: If you’ve suffered a disaster that prevents your business from meeting its ordinary and necessary financial obligations, you may be qualified for an Economic Injury Disaster Loan (EIDL). I got to meet Julia when she interviewed me about how my Girl Scout experience prepared me for my career in business. This form is a good way to protect your personal assets incase of any legal actions taken against your business. According to statistics, SBA has so far helped over 20 million enterprises, with over 200,000 loans worth over 40 million dollars.
Notable among it various programs are Small business loans for minorities, Small business loans for Women, Small business loans for veterans and young entrepreneurs. As the Reconstruction Finance Corporation’s influence waned in wake of the Dust Bowl, the Great Depression and World War II, the Small Business Administration became its natural successor.
There is nothing more disappointing to a borrower when they do everything that the bank asks, only to have their settlement offer declined because they didn’t know the parameters of the OIC process going in, and didn’t have a backup plan. However, unlike other funds, SBICs limit their investments to qualified small business concerns as defined by SBA regulations. Personal guarantees are required of each person who owns 20 percent or more of the borrowing business.
The SBA’s website outlines the business plan process and the necessary sections so your plan will be solid. SBA’s four basic loan programs are: Guaranteed Loans, Certified Development Company Loans or 504 Loan Program, Small Business Investment Companies, and Microloans. There are several types of Small Business Administration lenders and the difference is typically based upon the volume of SBA loans that the lender produces each year. Significant supplemental appropriations for the agency strengthened SBA lending through the American Recovery and Reinvestment Act of 2009 and the Small Business Jobs Act of 2010.