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President Obama's Plan to Boost Small Business Lending

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President Obama's Plan to Boost Small Business Lending

By BobK
Published: March 16, 2009

Earlier today, President Obama and Treasury Secretary Geithner announced a plan to free up credit markets to help the nation’s struggling small businesses.

The plan includes a release of $375 million for small business lending provided in the economic stimulus plan, which will increase the maximum SBA loan guarantee to 90 percent, and temporarily waive fees paid by borrowers.

Primary bank lenders often sell SBA loans in the secondary market, and use the proceeds of these sales to make new loans to other small businesses. However, investors have been reluctant to buy these loans. This means banks have not been able to make as many small business loans.

As a measure to unfreeze the secondary credit market, the President announced the U.S. Treasury will invest up to $15 billion in securities backed by SBA loans.

Visit the U.S. Dept of the Treasury's Unlocking Credit for Small Business Factsheet for more information.

Message Edited by BobK on 03-16-2009 03:05 PM

About the Author:

Bob

Comments:

Wow this is a great thing. I noticed this was done a long time ago 10 months ago it looks like. Have you found any sign that this has helped any? I have high (really high) hopes for 2010. I think it's going to be a good year and the economy will start turning around. I've heard many people are very optimistic. ;) -------- Justinshipping franchise Message Edited by NicoleD on 01-05-2010 04:43 PM
Kudos to CosmicRabbit - he nailed it! I wish I could have read the unedited version of the message.
Debt - the message was edited to disable a hyperlink that pointed to a commercial website.
What credit help is available for small business whose credit has been hurt. There seems to be no change in the credit score rating?

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