Small Business

Availing Small Business Loans To Keep Afloat

The Small Business Administration (SBA) in the US, assists small businesses nationwide to meet their financial needs.  This program gives lenders the ability to provide short and long term loans to small businesses that do not qualify via regular small business loan channels.

The four basic types of small business loans available are

- The 7(a) Business Loan Guaranty Program

- The 504 Certified Development Company Business Loan

- The Small Business Investment Company Program and

- Small Business Investment Grants.

The 7(a) Basic Business Loan Guaranty Program – This is the primary and most flexible loan program offered to small businesses since the agency can guarantee all financing requirements for several different business needs. The Small Business Administration in guaranteeing the small business loan is assuring a lender that in the event the loan is not repaid, the Small Business Administration will refund the lender for his loss, although the small business owner still owes and remains obligated to repay the full amount back to the SBA.  Start-up small businesses can use the proceeds of the 7(a) guaranteed business loan to

a) Renovate and expand start-up facilities

b) Refinance existing debt

c) Purchase equipment and machinery

d) Augment the business working capital and finance the receivables

e) Finance credit lines that are seasonal and

f)  Purchase land or construct commercial buildings.

The 7(m) Micro-Loan Program – It is the SBA’s Micro-Loan program which provides up to $35,000 to small businesses and non-profit childcare centers.

The 504 Certified Development Company (CDC) Program – Is a provider of long term, fixed rate loans for such things as buildings and land. The non-profit corporations contribute to the local communities assisting them with their economic development.

Small Business Investment Grants – These are small business loans that put venture capital into small businesses so that they can become modernized.  SBIC’s make venture capital investments. This is also good for growth and expansion. 

These small business loans not only take care of the Office of Veterans so as to maximize and make available small business loans to veterans, but also make loans available to the Reserve Component Members, disabled veterans and their dependents and survivors.

Some other loans available for small businesses are as follows – Energy and Conservation loans, Pollution control loans, Qualified Employee Trusts Loans, International Trade Loans (ITL), and Export Working Capital Loans (EWCL).  All these loans are easy to obtain and very necessary for many small businesses all over the country.