NxBizSuccess » MoneyTools Feature

Financial Resources for Business Ownership

Tonia Franklin — Thu, 12 Nov 2009 19:50:00 +0000

This webinar (51 minutes) provides information to current and potential business owners about Nebraska microenterprise statewide resources. Included is discussion on financing a small /micro business, along with saving and building credit for business ownership. Guest speakers were Jeff Christensen of NED, Inc., and Jeff Reynolds of REAP, along with Rose Jaspersen, Executive Director and Glennis McClure, Program Manager of NEF.

To access the webinar, click on the provided link: https://canhelp.webex.com/canhelp/lsr.php?AT=pb&SP=MC&rID=58206977&rKey=3fe5e5feb3f41ade

SBA Loans

Marilyn — Fri, 23 Oct 2009 19:46:26 +0000

The SBA offers numerous loan programs to assist small businesses. SBA is primarily a guarantor of loans made by private and other institutions, they do not directly loan to businesses. Contact the Nebraska SBA office for a list of Nebraska approved SBA lenders.

7(a) loans are the most basic and most used type loan of SBA’s business loan programs and are only available on a guaranty basis. The loans are provided by lenders who choose to structure their own loans by SBA’s requirements and who apply and receive a guaranty from SBA on a portion of this loan. The SBA does not fully guaranty 7(a) loans.

Besides credit and eligibility criteria, there are general terms and conditions SBA requires of a business seeking financial assistance. This information is available on the SBA Basic 7(a) Loan Program page.

The SBA Microloan Program provides very small loans to start-up, newly established, or growing small business concerns. SBA makes funds available to nonprofit community based lenders (intermediaries) which, in turn, make loans to eligible borrowers in amounts up to a maximum of $35,000. Applications are submitted to the local intermediary and all credit decisions are made on the local level. Interest rates will vary, depending upon the intermediary lender and costs to the intermediary from the U.S. Treasury. Generally these rates will be between 8 eight percent and thirteen percent.

A contact list of eligible Microloan lenders is available on the SBA Microloan page.

SBA America’s Recovery Capital Loan Program can provide up to $35,000 in short-term relief for viable small businesses facing immediate financial hardship due to uncertain economic conditions. Each small business is limited to one ARC loan. ARC loans will be offered by some SBA lenders as long as funding is available or until September 30, 2010, whichever comes first. The temporary ARC program offers interest-free loans to viable small businesses, which carry a 100 percent guaranty from the SBA to the lender and require no fees paid to SBA. Loan proceeds are provided over a six-month period and repayment of the ARC loan principal is deferred for 12 months after the last disbursement of the proceeds. Repayment can extend up to five years.

For ARC loan details contact the Nebraska Small Business Association or SBA ARC loan website.

The CDC/504 loan program is a long-term financing tool for economic development within a community. The 504 Program provides growing businesses with long-term, fixed-rate financing for major fixed assets, such as land and buildings. A Certified Development Company is a nonprofit corporation set up to contribute to the economic development of its community. CDCs work with the SBA and private-sector lenders to provide financing to small businesses. The maximum SBA debenture is $1,500,000 when meeting the job creation criteria or a community development goal. Generally, a business must create or retain one job for every $50,000 provided by the SBA except for “Small Manufacturers” which have a $100,000 job creation or retention goal (see below).The maximum SBA debenture is $2.0 million when meeting a public policy goal.

Current SBA 504 lender in Nebraska is the Nebraska Economic Development Corporation (NEDCO)

SBA Basic Loan Information

Marilyn — Wed, 07 Oct 2009 19:50:33 +0000

The U.S. Small Business Administration (SBA) is an independent agency of the federal government. Its purpose is to aid, counsel, assist and protect the interests of small business concerns, to preserve free competitive enterprise and to maintain and strengthen the overall economy of our nation. There are numerous loan programs offered through the SBA that businesses can access through SBA preferred and certified lenders.

Prior to seeking a SBA loan, review the SBA eligibility requirements to make sure you qualify. Every application needs positive credit merits to be approved. These are the same credit factors a lender will review and analyze before deciding whether to internally approve your loan application, seek a guaranty from SBA to support their loan to you, or decline your application all together.

There is a very informative online training on SBA lending programs. It would be very helpful to individuals considering SBA loans. Finance Primer: Guide to SBA’s Loan Guaranty Programs.

SBA also has a free online course on How to prepare a Loan Package.

USDA Rural Development Grants and Loans

Marilyn — Fri, 11 Sep 2009 19:51:36 +0000

Promoting a dynamic business environment in rural America is the goal of Rural Development, Business and Cooperative Programs (BCP), and Business Programs (BP). BP works in partnership with the private sector and the community-based organizations to provide financial assistance and business planning. BP helps fund projects that create or preserve quality jobs and/or promote a clean rural environment. The financial resources of BP are often leveraged with those of other public and private credit source lenders to meet business and credit needs in under-served areas. Recipients of these programs may include individuals, corporations, partnerships, cooperatives, public bodies, nonprofit corporations, Indian tribes, and private companies.

USDA Programs are:

Business and Industry Guaranteed Loans – Purpose is to bolster the existing private credit structure through the guarantee of quality loans which will provide lasting community benefits.
Intermediary Relending Program Loans – loans are provided to local organizations (intermediaries) for the establishment of revolving loan funds. These revolving loan funds are used to assist with financing business and economic development activity to create or retain jobs in disadvantaged and remote communities.
Rural Economic Development Loans and Grants – Provides zero interest loans to local utilities which they, in turn, pass through to local businesses (ultimate recipients) for projects that will create and retain employment in rural areas.
Rural Business Enterprise Grants - Grants for rural projects that finance and facilitate development of small and emerging rural businesses help fund distance learning networks, and help fund employment related adult education programs.
Rural Business Opportunity Grants – Promotes sustainable economic development in rural communities with exceptional needs through provision of training and technical assistance for business development, entrepreneurs, and economic development officials and to assist with economic development planning.
Rural Cooperative Development Grants – For establishing and operating centers for cooperative development for the primary purpose of improving the economic condition of rural areas through the development of new cooperatives and improving operations of existing cooperatives.
Biorefinery Assistance Program – Assist in the development of new and emerging technologies for the development of advanced biofuels.
Bioenergy Program for Advanced Biofuels – Support and ensure an expanding production of Advanced Biofuels by providing payments to Eligible Advanced Biofuel Producers in rural areas.
Repowering Assistance Program – Encourage the use of renewable biomass as a replacement fuel source for fossil fuels used to provide process heat or power in the operation of these eligible biorefineries.
Rural Energy for America Program – Grants for energy audits and renewable energy development assistance and grants to agricultural producers and rural small businesses to purchase and install renewable energy systems and make energy efficiency improvements.
Rural Energy for America Program Guaranteed Loan Program – Encourages the commercial financing of renewable energy (bioenergy, geothermal, hydrogen, solar, wind and hydro power) and energy efficiency projects