Learn More About the Two New SBA Loans Available
Small business owners face unique situations, and that is why the U.S. Small Business Administration (SBA) has recently unveiled two new SBA loans as pilot programs. These offerings provide financial assistance to small business borrowers in specific cases.
The Community Advantage program is unique because it offers a high maximum loan amount of $250,000, along with a budget-friendly interest rate of prime + 6 percent. This program is meant to help small businesses in underserved areas that would not be able to get similar financing through other means. The goal of the Community Advantage loan is to drive revenue into locations where maintaining jobs and services is vital to the local economy.
To qualify for Community Advantage SBA loans, organizations must be creditworthy and have a promising business plan. Even the smallest businesses are eligible. Program funds may be used to purchase fixed assets or expand working capital. However, they may not be used as a revolving credit line.
Express Bridge Loan
The Express Bridge Loan (EBL) program provides lightning-fast assistance to businesses in the wake of disasters. The EBL is intended to provide SBA-guaranteed funds to impacted businesses more quickly than other loan programs can. The maximum available loan amount is $25,000, and the loan must be repaid within seven years. It is important to apply immediately after a disaster strikes in order to take advantage of this program.
Further requirements for these emergency SBA loans include that the business must be located in the primary county or an adjoining county of an event that has been declared a disaster by the president; eligible for 7(a) lending programs; open and operational before the disaster hit; and using the EBL funds to reopen or restore operations.
The EBL is intended to be a quick supplement to other disaster funding that is offered by the SBA. If a business is approved for a longer duration SBA disaster loan, funds from the express loan may have to be repaid before the new loan will be funded.
Consider Your Options
SBA loans are continuously evolving to meet the needs of small business owners. If your business operates in an underserved area, the Community Advantage Loan may be an option for expanding your business or upgrading equipment. If you are affected by a major disaster, keep the Express Bridge Loan program in mind. These programs are intended to serve the needs of your small business and ensure the continued growth of our economy.