Small businesses unable to get financed by normal loan providers are helped by the Small Business Association (SBA) loan programs. The loan programs are operated through the private sector loan providers (banks, credit unions, etc.) and guaranteed by the SBA. The SBA itself doesn’t have funds for direct lending but it guarantees the loan made to the small companies.
Brief descriptions of the primary loan programs made available by the US SBA are given here.
7(a) Loan Program
SBA’s primary and flexible loan program, it offers guaranteed financing for various business purposes and has been designed for new and existing small businesses. The important types of 7 (a) loans are:
1. Express programs
2. Export Loan Programs
3. Rural Lender Advantage Program
4. Special Purpose Loans Program
CDC/504 Loan Program
The program gives long term, fixed-rate financing to obtain fixed assets that may include real estate or equipments and is delivered by Certified Development Companies (CDC) which are non-profit corporations formed to help in economic developments of their communities.
Microloan Program
The program offers small short term loans of up to $35,000 for the start-up of a small business, which may include the infrastructure and the supplies. The loan is offered through non profit organizations.
Disaster Assistance Loan Program
This program provides low interest loans to all the people in declared disaster area. It isn’t necessary to own a business to qualify for the loan. Home owners, renters and personal property owners and also the owners of businesses of various sizes can apply for the loan.
America's Recovery Capital Loan Program (ARC)
This is provided to the small businesses facing immediate financial hardship to help them cope up with the crisis. They are limited and each small business can get only one ARC loan. The loan, up to $35,000, will be offered till the funds last or until September 30, 2010, whichever comes first.
