Good news on the SBA financing front! Obama signed the 2010 Small Business Jobs Act, and highlights of the new bill with regard to SBA loans include:
Increase in the guarantees for SBA’s largest loan program (the 7(a) program) to 90% and reduction of fees for the 7(a) and 504 program – has the capacity to support $14 billion in lending to small businesses.
•Within Coming Weeks, the Bill Will Allow SBA to Support Larger Loans As Well: The bill also increases the maximum loan size for SBA loan programs, which in the coming weeks will allow more small businesses to access more credit to enable them to expand and create new jobs. The bill also
◦Permanently raises the maximum loan size for the SBA’s two largest loan programs, increasing maximum 7(a) and 504 loan size from $2 million to $5 million.
Permanently raises the maximum loan size for SBA microloans, increasing it from $35,000 to $50,000.
◦Temporarily raises the maximum loan size for SBA Express loans from $350,000 to $1 million, providing greater access to working capital loans that small businesses use to purchase new inventory and take on their next order – allowing them to create new jobs.
•Treasury Is Working to Quickly Implement the Small Business Lending Fund and State Small Business Credit Initiative: In addition to these SBA provisions, Treasury is working to quickly implement two new programs designed to support private-sector lending to credit-worthy small businesses, and expects to release further details in the coming weeks concerning applications for these programs.
◦The Small Business Lending Fund would make available $30 billion in capital to small banks with incentives to increase small business lending, potentially supporting several multiples of that amount in new credit.
◦The State Small Business Credit Initiative will support at least $15 billion in new lending by strengthening state small business programs – many of them facing budget cuts – that leverage private-sector lenders to extend additional credit.
Increase in the guarantees for SBA’s largest loan program (the 7(a) program) to 90% and reduction of fees for the 7(a) and 504 program – has the capacity to support $14 billion in lending to small businesses.
•Within Coming Weeks, the Bill Will Allow SBA to Support Larger Loans As Well: The bill also increases the maximum loan size for SBA loan programs, which in the coming weeks will allow more small businesses to access more credit to enable them to expand and create new jobs. The bill also
◦Permanently raises the maximum loan size for the SBA’s two largest loan programs, increasing maximum 7(a) and 504 loan size from $2 million to $5 million.
Permanently raises the maximum loan size for SBA microloans, increasing it from $35,000 to $50,000.
◦Temporarily raises the maximum loan size for SBA Express loans from $350,000 to $1 million, providing greater access to working capital loans that small businesses use to purchase new inventory and take on their next order – allowing them to create new jobs.
•Treasury Is Working to Quickly Implement the Small Business Lending Fund and State Small Business Credit Initiative: In addition to these SBA provisions, Treasury is working to quickly implement two new programs designed to support private-sector lending to credit-worthy small businesses, and expects to release further details in the coming weeks concerning applications for these programs.
◦The Small Business Lending Fund would make available $30 billion in capital to small banks with incentives to increase small business lending, potentially supporting several multiples of that amount in new credit.
◦The State Small Business Credit Initiative will support at least $15 billion in new lending by strengthening state small business programs – many of them facing budget cuts – that leverage private-sector lenders to extend additional credit.
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