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WELCOME TO
America’s Small Business Resource
www.sba.gov/va11/9/09
Technical AssistanceTechnical AssistanceProcurement AssistanceProcurement AssistanceFinancial Assistance Financial Assistance
U.S. Small Business U.S. Small Business AdministrationAdministrationMajor ProgramsMajor Programs
TECHNICAL ASSISTANCETECHNICAL ASSISTANCEFor more information go to www.sba.gov/vaFor more information go to www.sba.gov/va
Service Corp of Retired Executives11 chapters in Virginiawww.score.org
VA Small Business Development Centers29 centers in the Virginiawww.virginiasbdc.org
Women’s Business Centers Richmond and Springfield, VA www.nvnv.org www.wbcnova.org
TECHNICAL ASSISTANCE
MarketingAccountingOrganizationalBusiness PlanningCash Flow ManagementGovernment ProcurementBusiness Licensing and Regulations
One-on-one Counseling Seminars Information Resource Training Programs
SCORE SBDC WBCSCORE SBDC WBC
One-stop assistance
PROCUREMENT ASSISTANCEMinority Business Development &Minority Business Development &
Government Contracting ProgramsGovernment Contracting Programs
8(a) Business Development Program8(a) Business Development Program
Small Disadvantaged Business (SDB) ProgramSmall Disadvantaged Business (SDB) Program
HUBZone Empowerment Contracting ProgramHUBZone Empowerment Contracting Program
Surety Bond Guarantee ProgramSurety Bond Guarantee Program
Service-Disabled Veteran-Owned Small Service-Disabled Veteran-Owned Small Business (SDVOSB) ProgramBusiness (SDVOSB) Program
SBA SBA does NOTdoes NOT provide grants provide grants
www.grants.govwww.grants.gov www.cfda.gov SBA SBA does NOTdoes NOT make DIRECT loans make DIRECT loans
except under its Disaster lending programsexcept under its Disaster lending programs
SBA SBA DOESDOES PROVIDE: PROVIDE:
Loan Guaranty on loans made directly Loan Guaranty on loans made directly by banks with the SBA’s backing.by banks with the SBA’s backing.
Financial AssistanceFinancial AssistanceSBA’s Role in providing Financial assistance
Financial AssistanceFinancial Assistance
7(a) Loan Program7(a) Loan Program
504 Loan Program504 Loan Program
Loans may be used for any reasonable
business purpose including:
Equipment Debt refinancing
Inventory Business purchase
Real estate Working Capital Franchise www.franchiseregistry.com
Financial Assistance 7(a) Loan Guaranty Program
Maximum Loan MaturitiesMaximum Loan Maturities
Working Capital 5-7 yearsWorking Capital 5-7 years
Real Estate up to 25 yearsReal Estate up to 25 years
Machinery Machinery useful life of assetuseful life of asset
Just about everything else is 10 yearsJust about everything else is 10 years
Financial Assistance 7(a) Loan Guaranty Program
SBA Interest Rate PolicySBA Interest Rate Policy
Terms of less than 7 years Terms of less than 7 years Prime +2 1/4%Prime +2 1/4%
Terms of 7 years or moreTerms of 7 years or more
Prime +2 3/4%Prime +2 3/4% SBASBAExpressExpress Loans & Loans less than Loans & Loans less than
$50,000 may have higher interest $50,000 may have higher interest ratesrates
Financial Assistance 7(a) Loan Guaranty Program
SBA General Eligibility CriteriaSBA General Eligibility Criteria Must be for profitMust be for profit
Not Not engaged in lending, real-estate development, engaged in lending, real-estate development,
investments or speculationinvestments or speculation
Must be smallMust be small www.sba.gov/sizewww.sba.gov/size Must have a sound business Must have a sound business
purposepurpose Good CreditGood Credit Good CharacterGood Character Equity InvestmentEquity Investment
Financial AssistanceFinancial Assistance 7(a) Loan Guaranty Program7(a) Loan Guaranty Program
Financial AssistanceFinancial Assistance 7(a) Loan Guaranty Program7(a) Loan Guaranty Program
Maximum Maximum $2,000,000 $2,000,000 loan limitloan limit
-SBAExpress: Up to $350,000$350,000-Patriot Express: Up to $500,000$500,000-SBA CommunityExpress - Up to $250,000
SBASBAExpressExpress Uses lender’s forms — not SBA’sUses lender’s forms — not SBA’s Loans or revolving lines of credit to $350,000Loans or revolving lines of credit to $350,000
(Export Express up to $250,000)(Export Express up to $250,000)
SBA guaranty of 50% to the bank SBA guaranty of 50% to the bank 36-hour response from the SBA36-hour response from the SBA
Financial Assistance 7(a) Loan Guaranty Program
PATRIOT EXPRESSPATRIOT EXPRESS Similar to SBASimilar to SBAExpress Express but only but only
open to the military community open to the military community and their spousesand their spouses
Loan Limit increased to $500,000Loan Limit increased to $500,000 Guaranty increased to 7(a) levelsGuaranty increased to 7(a) levels Interest rates lowered to 7(a) levelsInterest rates lowered to 7(a) levels
Patriot Express EligibilityPatriot Express Eligibility
VeteransVeterans Active Service members eligible for TAPActive Service members eligible for TAP Reservists and National Guard MembersReservists and National Guard Members Current Spouses of the aboveCurrent Spouses of the above Widowed Spouses of the any of the Widowed Spouses of the any of the
above who died during service or from above who died during service or from service- connected disabilitiesservice- connected disabilities
Community Express Loan Community Express Loan ProgramProgram
Loan up to $250,000 Loan up to $250,000 ( lenders may set lower limits) ( lenders may set lower limits)
All other 7(a) criteria appliesAll other 7(a) criteria applies
Technical Assistance (T/A) AvailableTechnical Assistance (T/A) AvailableFind updated list of T/A providers atFind updated list of T/A providers at
www.sba.gov/va
Financial Assistance 7(a) Loan Guaranty Program
$1,500,000$2,000,000 for Public Policy Loans $4,000,000 for Small Manufacture
This is currently proposed to be increased to $5 million
***Excluding the bank financing and equity injection
Maximum SBA/504 Debenture Financing***
Financial AssistanceFinancial Assistance 504 Loan Program504 Loan Program
Certified Development CompaniesCertified Development Companies
Typical 504 Structure
Bank financing required for 50% of costCDC/SBA may finance 30-40% of project
Business normally invests 10-20% of the cost
Financial AssistanceFinancial Assistance 504 Loan Program504 Loan Program
Certified Development CompaniesCertified Development Companies
Financial AssistanceFinancial Assistance 504 Loan Program504 Loan Program
Certified Development CompaniesCertified Development Companies
Fixed asset financing onlyFixed asset financing only Long term - Long term - 10 or 20 years10 or 20 years Low fixed rate of interestLow fixed rate of interest Generally requires job creationGenerally requires job creation Certain loans may now be refinanced into the Certain loans may now be refinanced into the
SBA 504 loanSBA 504 loan Refinancing limited to 50% of expansionRefinancing limited to 50% of expansion
SBA Nationwide Loan Volume SBA Nationwide Loan Volume Dollars in BillionsDollars in Billions
Richmond District Loan Volume Richmond District Loan Volume Dollars in MillionsDollars in Millions
American Recovery & American Recovery & Reinvestment Act of 2009Reinvestment Act of 2009
•The bill provided $730 million to SBA and makes changes to the agency’s lending programs so that they can reach more small businesses that need help. The funding includes:
• $375 million for temporary elimination of Borrower’s Fee•$255 million for a new loan program to help small businesses meet existing debt payments tentatively called the American Recovery Capital (ARC) Loan Program •Increase SBA guaranty percentage to 90% for most loan programs
`
7(a) 2009 Loan Program 7(a) 2009 Loan Program EnhancementsEnhancements
Loan Programs receiving a 90% guaranty Loan Programs receiving a 90% guaranty are:are:
Regular 7(a), PLP, CLP, Community Express, Regular 7(a), PLP, CLP, Community Express, Patriot Express, Export Express, and Patriot Express, Export Express, and Small/Rural Lender Advantage.Small/Rural Lender Advantage.
SBASBAExpressExpress remains at 50% remains at 50%
How Long will these enhancements How Long will these enhancements last?last?
SBA will eliminate upfront guaranty fees and SBA will eliminate upfront guaranty fees and increase guaranty percentages until about March increase guaranty percentages until about March 28, 2010. 28, 2010.
12/19/09 - Additional $125 million authorized12/19/09 - Additional $125 million authorized
3/2/10 – Additional $60 million authorized 3/2/10 – Additional $60 million authorized
ARC Funding may last until September 2010ARC Funding may last until September 2010
American Recovery Capital (ARC) Loan American Recovery Capital (ARC) Loan Program Program
Loans to viable small businesses that have a Loans to viable small businesses that have a qualifying small business loan and are qualifying small business loan and are experiencing immediate financial hardship. Viable experiencing immediate financial hardship. Viable may be simply showing ability to repay the loan.may be simply showing ability to repay the loan.
Program parameters include:Program parameters include:a)a) Maximum Loan is $35,000Maximum Loan is $35,000b)b) Proceeds shall be used to make full or partial P & I loan payments on Proceeds shall be used to make full or partial P & I loan payments on
qualifying loans for a period of time not to exceed 6 months.qualifying loans for a period of time not to exceed 6 months.c)c) Have a 100% SBA GuarantyHave a 100% SBA Guarantyd)d) No Guaranty Fee (or other SBA fee)No Guaranty Fee (or other SBA fee)e)e) Have interest fully paid by SBA for the period of the loan – Prime plus 2%Have interest fully paid by SBA for the period of the loan – Prime plus 2%f)f) Repayment does not begin until 12 months after final disbursement of Repayment does not begin until 12 months after final disbursement of
funds.funds.g)g) Maximum Term is 6.5 yearsMaximum Term is 6.5 years
Nationwide ARC Lending Nationwide ARC Lending through March 5, 2010through March 5, 2010
6,484 loans (796,484 loans (79 in Virginia) in Virginia) $209,394,892 ($2,406,134 VA)$209,394,892 ($2,406,134 VA) 49 states (plus DC)49 states (plus DC) 1,175 lenders (23 in Virginia)1,175 lenders (23 in Virginia) 667 industries667 industries
Virginia ARC Loans YTDVirginia ARC Loans YTD
Old Point National Bank 16Old Point National Bank 16 StellarOneStellarOne 13 13 SunTrust BankSunTrust Bank 13 13 Frontier Community BankFrontier Community Bank
77 Virginia Company BankVirginia Company Bank 66 Wells Fargo Wells Fargo 55 UVA Community CU 4 UVA Community CU 4 Central Virginia BankCentral Virginia Bank 33 Peoples Bank of Virginia 3Peoples Bank of Virginia 3 Bank of LancasterBank of Lancaster 2 2
Farmers & Merchants 1 Farmers & Merchants 1 First Bank & Trust 1First Bank & Trust 1 First Capital BankFirst Capital Bank 1 1 First Market BankFirst Market Bank 11 Jefferson Security BankJefferson Security Bank 11 Park View FCUPark View FCU 1 1 River Community BankRiver Community Bank 11 Surrey Bank and TrustSurrey Bank and Trust 11 Union Bank and TrustUnion Bank and Trust 11 United BankUnited Bank 11 Virginia National BankVirginia National Bank 11
Through March 5, 2010
SBA Recovery Efforts SBA Recovery Efforts ImpactImpact
Loan Volume Has Increased 76 %Loan Volume Has Increased 76 % As of October 30, SBA has As of October 30, SBA has supported $13.9 supported $13.9
billion in small business lendingbillion in small business lending with the with the approval of $10.2 billion in loans since Feb. 17. approval of $10.2 billion in loans since Feb. 17.
More Lenders Making LoansMore Lenders Making Loans From Feb. 17 to September 30, more than From Feb. 17 to September 30, more than
1,260 lenders that had not made a loan 1,260 lenders that had not made a loan since Oct. 2008 made 7(a) or ARC loans. since Oct. 2008 made 7(a) or ARC loans.
Secondary Markets UptickSecondary Markets Uptick After months of reduced activity and After months of reduced activity and
lower premiums, the SBA 7(a) lower premiums, the SBA 7(a) secondary market is picking up and secondary market is picking up and premiums are beginning to recover. premiums are beginning to recover.
From May to September, the average From May to September, the average monthly loan volume was $348 million. monthly loan volume was $348 million.
This has provided lenders with This has provided lenders with additional liquidity to increase lending.additional liquidity to increase lending.
Other Recovery ProgramsOther Recovery Programs
Size Standards Temporarily IncreasedSize Standards Temporarily Increased Including its affiliates, the applicant’s Including its affiliates, the applicant’s
tangible net worth may be up to $8.5 million, tangible net worth may be up to $8.5 million, and average net income after Federal and average net income after Federal income taxes (excluding any carry-over income taxes (excluding any carry-over losses) for the preceding two completed losses) for the preceding two completed fiscal years may be up to $3.0 million.fiscal years may be up to $3.0 million.
Floor Plan Financing is now eligible for Floor Plan Financing is now eligible for certain industriescertain industries
U.S. Small Business AdministrationRichmond District Office
www.sba.gov/va
THANK YOU THANK YOU & Good LUCK & Good LUCK
Your partner for successYour partner for success
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