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America’s Small Business Resource

America’s Small Business Resource. The U.S. Small Business Administration. Our Mission Assist small business in getting started, stay in business and to expand SBA provides assistance in (3) three major areas Capital Access Counseling Contracts. The U.S. Small Business Administration.

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America’s Small Business Resource

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  1. America’s Small Business Resource

  2. The U.S. Small Business Administration • Our Mission • Assist small business in getting started, stay in business and to expand • SBA provides assistance in (3) three major areas • Capital Access • Counseling • Contracts

  3. The U.S. Small Business Administration • In FY 2007, SBA Nationally • delivered over $20.6 billion in financing, • guaranteed over 110,000 loans, and • In FY 2007, SBA in Illinois • 144 participating lenders • delivered over $683 million in financing, • guaranteed 4,653 loans

  4. SBA’s Financial Programs • 7(a) Guaranty Loan Programs • 504 Loan Program • Micro Loan Program

  5. Three (3) Main Reasons Why Lenders Use SBA • Newer or Start-Up Business • Collateral • Longer Repayment Term

  6. Size: Must Qualify as a Small Business A Small Business is Independently Owned and Operated Not Dominate in the Field Meets SBA's Employment or Sales Standards Wholesale - No more than 100 Employees Retail or Service - $6.5 to $32.5 Million Manufacturing - 500 to 1,500 Employees Construction $13.0 to $31.0 Million General Eligibility Requirements

  7. Purpose of Loan • Purchase Land or Buildings • Expansion or Conversion of Existing Facilities • To Purchase Machinery & Equipment, Supplies, Materials, or Inventory • Working Capital • Short Term Asset Based Lines of Credit • Debt Refinancing (Under Limited Circumstances)

  8. Loan Amounts Terms and Conditions

  9. 7 (a) Loan Program • The Maximum SBA Loan amount Will Not Exceed $2,000,000 • The Maximum SBA Share of Any Loan or Guaranty Usually Will Not Exceed $1,500,000 • SBA’s Guaranty on Any Loan of $150,000 or Less is Usually 85% • SBA’s Guaranty on Any Loan of More Than $150,000 is Usually 75%

  10. Loan Maturity • Working Capital Loans - Up to 7 Years • Machinery and Equipment - Up to 10 Years • Construction of Plant Facilities - Up to 25 Years • Repayment Usually on a Monthly Installment Basis, Principal and Interest • Variations Negotiated to Meet Seasonal Cycles of Business Activity

  11. Interest Rates • Are Negotiated Between the Applicant and the Lender Based on the Credit Merits of the Application • For Loans with a Maturity of Less than 7 Years, the Maximum Rate is New York Prime, Plus 2 1/4 Percent • For Loans with a Maturity of 7 Years or more, the Maximum Rate is New York Prime, Plus 2 3/4 Percent • Exceptions are Made for Loans Under $50,000 and Express Loans, Which May be Slightly Higher

  12. Fees Associated with SBA Loans • If the Loan Amount is $150,000 or Less, the Fee is 2% of the Guaranteed Portion • If the Loan Amount is More than $150,000, but Less than $700,000, the guaranty fee is 3% of the Guaranteed Portion • If the Loan Amount is More than $700,000, the Guaranty fee is 3.5% of the Guaranteed Portion

  13. SBA’s Express Program • Designed to Increase Capital Available to Businesses Seeking Loans Up to $350,000 • Can Also be Used for Lines of Credit • Businesses Only Need to Complete Lenders Application • No Additional Documentation from SBA • No Waiting for SBA Loan Approval • Offers a 50% guaranty

  14. CommunityExpress • Expedited Loan Processing • Focuses on LMI/New Markets • Maximum Loan Amount is $250,000 • Standard 7(a) 75% and 85% Guaranty Applies • Technical Assistance Provided by Lenders

  15. CommunityExpress Lenders in Illinois • Banco Popular • Business Loan Express • Chase • First American Bank • Innovative Bank • LaSalle Bank • National City Bank • Superior Financial Group • U.S. Bank

  16. Patriot Express • Focuses on Veterans & Spouses of • Expedited Loan Processing • Maximum Loan Amount is $500,000 • Standard 7(a) 75% and 85% Guaranty Applies • Lower Interest rate cap – like 7(a) • Generally 2 ¼ to 2 ¾ over Prime

  17. For More Information on SBA’s Programs & Services ... • Our National Site is located at www.sba.gov • Visit the Illinois District Office Website atwww.sba.gov/il • (312) 353-4528

  18. America’s Small Business Resource

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