Gov’t Takes Steps To Make SBA Loans Easier To Get
Small business owners who have watched banks and automakers get assistance from the government can now receive some help, too.
The government is making it easier for companies to get loans from the Small Business Administration. It’s eliminating fees on its most popular loans, known as 7a loans, and guaranteeing a larger portion of the amount borrowed. It’s also eliminating fees on what are called CDC/504 loans.
Small businesses will also benefit from the Troubled Asset Relief Program, or TARP, that’s been used to bail out banks. The government will use $15 billion in TARP money to buy already issued small business loans in what’s known as the secondary market.
That plan, according to SBA spokesman Mike Stamler, will enable lenders to get old loans off their books and allow them to create new ones. The slowdown in credit markets has made it harder for banks to sell their loans and move on to the next borrower.
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Photo by SBA.
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