The SBA's 504 lending
intermediaries, Certified Development Companies (CDCs) serve your community to
finance business expansion needs through 504. Its professional staff works
directly with you to tailor a financing package that meets program guidelines
and the credit capacity of your business. The 504 Loan Program is the first
national financing program specifically designed for expanding small business
whose investment will create jobs.
The Certified and
Preferred Lenders Program
The most active and
expert lenders qualify for the SBA's Certified and Preferred Lenders Program.
Participants are delegated partial or full authority to approve loans, which
results in faster service. Certified lenders are those that have been heavily
involved in regular SBA loan-guaranty processing and have met certain other
criteria. They receive a partial delegation of authority and are given a
three-day turnaround on their applications (they may also use regular
processing).
Certified lenders
account for 10 percent of all SBA business loan guaranties. Preferred lenders
are chosen from among the SBA's best lenders and enjoy full delegation of lending
authority. This authority must be renewed at least every two years, and the lender's
portfolio is examined by the SBA periodically. Preferred loans account for 18 percent
of SBA loans. For list of certified/preferred lenders in your area contact your
local SBA office.
The 7(M) Microloan
Program
These loans are
provided directly by a network of intermediaries approved by the SBA for the purpose
of making microloans (from $100 up to $35,000) to small businesses for the purchase
of machinery, equipment, furniture, fixtures, and inventory and also for
working capital. These intermediaries also provide technical and management
assistance to the owners. Most small businesses who are unable to obtain
funding through conventional sources or the other SBA guaranteed loan programs
should contact the microloan lenders in their area.
The Small Business
Investment Company (SBIC) Program
There are a variety of
alternatives to bank financing for small businesses, especially business
start-ups. The Small Business Investment Company Program is the gap between the
availability of venture capital and the needs of small businesses that are either
starting or growing. Licensed and regulated by the SBA, SBICs are privately
owned and managed investment firms that make capital available to small
businesses through investments or loans. They use their own funds plus funds
obtained at favorable rates with SBA guaranties and/or by selling their
preferred stock to the SBA. SBICs are for-profit firms whose incentive is to
share in the success of a small business. In addition to equity capital and
long-term loans, SBICs provide debt-equity investments and management assistance.
The SBIC Program provides funding to all types of manufacturing and service industries.
Some investment companies specialize in certain fields, while others seek out small
businesses with new products or services because of the strong growth potential.
Most, however, consider a wide variety of investment opportunities.
Community Adjustment
& Investment Program
The Community
Adjustment & Investment Program (CAIP) was created to help communities that
suffered job losses due to changing trade patterns following the North American
Free Trade Agreement (NAFTA). The North American Development Bank has partnered
with the SBA and the U.S. Department of Agriculture to make credit available to
businesses in eligible communities to create or retain jobs. Business
applicants must be able to demonstrate that the loan or loan guaranty will be
used to create or preserve at least one job for every $35,000 in loans over a
24-month period.
SBA Pre-Qualification
(Pre-Qual) Pilot Loan Program
SBA Pre-Qualification
Pilot Loan (Pre-Qual) Program was developed to provide substantive support and
assistance in the small business loan application process to those segments of
the small business community that traditionally may have been underserved by
the lending community.
The Pre-Qual concept
was originally introduced as the Women's PreQualification Pilot Loan Program in
June 1994. A Minority PreQualification Pilot Loan Program followed in April
1995. In July 1998, these programs were combined under an umbrella Pre-Qual program
to more aggressively market the SBA's loan programs to a wider variety of underserved
markets.
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