The Basics of the New SBA “Small Loan Advantage Loan” Program

Most who follow small business financing were well aware of the popular Community Express L oan Program. Unfortunately, in part, because of a high default rate, it was discontinued in April of 2011. The good news is that a new program has recently been introduced  by the SBA called the Small Loan Advantage Program to replace it. The new offering is targeted at small businesses that are less than 2 years old and are located in low to moderate income communities.

Like Community Express, loans will only be available through SBA approved lenders. Some of the key features of the new program are:

  • The maximum amount available is $350,000
  • The SBA will guarantee up to 85% for loans under $150,000 and 75% over $150,000. The discontinued Community Express Program only provided guarantees up to 50%.
  • Funds may be used for inventory, working capital, furniture, fixtures and equipment.
  • The application process is straight forward, requiring only a two page form. Very quick turn around on the application is possible, usually in 5-10 days.
  • Lenders will likely require collateral for these loans

Two SBA lenders are accepting these loan applications. Borrego Springs Bank in Panama City, Florida, and Superior Financial Group in Walnut Creek, California. Superior Financial will be holding two educational workshops in December describing the new program. One is at North Wake Tech on December 4, 2012, from 6:45-9 PM and the other on December 6, 2012, at Western Wake Tech in Cary also from 6:45-9 PM. You can contact the local SBA office at 919-335-1004 for more information.

For all your small businesses mentoring needs, be sure to contact your Raleigh SCORE office at 919-856-4739 M-F from 9AM to 12PM, or by accessing our website at http://raleigh.score.org.

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