Your Local SBA

Financing

 

SBA provides a number of financial assistance programs for small businesses.  They have been specifically designed to meet a business's key financing needs including the need for debt financing (loans), equity financing (investment/seed money), surety bonds, and disaster loans.  (SBA does not provide grant funds to finance small businesses.)  SBA addresses these needs through the following four broad finance programs:

  • BUSINESS LOAN PROGRAMS:

 

  • Basic 7(a) Loan Guaranty Program:  Serves as the SBA's primary business loan program to help qualified small businesses obtain financing when they might not be eligible for business loans through normal lending channels. It is also the agency's most flexible business loan program, since financing under this program can be guaranteed for a variety of general business purposes. Loan proceeds can be used for most sound business purposes including working capital, machinery and equipment, furniture and fixtures, land and building (including purchase, renovation and new construction), leasehold improvements, and debt refinancing (under special conditions). Loan maturity is up to 10 years for working capital and generally up to 25 years for fixed assets.  For more details, see SBA's Basic 7(a) Loan Program.  SBA offers multiple variations of the basic 7(a) loan program to accommodate targeted needs.  For more details, see SBA's Special Purpose Loan Programs.
    Customer: Start-up and existing small businesses, commercial lending institutions.
    Delivered through: Commercial lending institutions.  View a list of 7(a) Participating Lenders.
  • Certified Development Company (CDC), a 504 Loan Program:  Provides long-term, fixed-rate financing to small businesses to acquire real estate or machinery or equipment for expansion or modernization. Typically a 504 project includes a loan secured from a private-sector lender with a senior lien, a loan secured from a CDC (funded by a 100 percent SBA-guaranteed debenture) with a junior lien covering up to 40 percent of the total cost, and a contribution of at least 10 percent equity from the borrower. The maximum SBA debenture generally is $1.5 million (and up to $4 million in some cases).  For more details, see SBA's 504/CDC Loan Program.
    Customer: Small businesses requiring "brick and mortar" financing.
    Delivered through: Certified development companies (private, nonprofit corporations set up to contribute to the economic development of their communities or regions).  View a list of Certified Development Companies.
  • Microloan, a 7(m) Loan Program:  Provides short-term loans of up to $35,000 to small businesses and not-for-profit child-care centers for working capital or the purchase of inventory, supplies, furniture, fixtures, machinery and/or equipment. Proceeds cannot be used to pay existing debts or to purchase real estate. The SBA makes or guarantees a loan to an intermediary, who in turn, makes the microloan to the applicant. These organizations also provide management and technical assistance. The loans are not guaranteed by the SBA. The microloan program is available in selected locations in most states.  For more information, see SBA's Microloan Program.
    Customer: Small businesses and not-for-profit child-care centers needing small-scale financing and technical assistance for start-up or expansion.
    Delivered through: Specially designated intermediary lenders (nonprofit organizations with experience in lending and in technical assistance).  View a list of Microloan Intermediary Lenders.

 

  • INVESTMENT PROGRAMS:

There are a variety of alternatives to bank financing for small businesses, especially business start-ups. The Small Business Investment Company Program (SBIC) fills the gap between the availability of venture capital and the needs of small businesses that are either starting or growing. Licensed and regulated by the SBA, SBICs are privately owned and managed investment firms that make capital available to small businesses through investments or loans. They use their own funds plus funds obtained at favorable rates with SBA guaranties. SBICs are for-profit firms whose incentive is to share in the success of a small business. In addition to equity capital and long-term loans, SBICs provide debt-equity investments and management assistance. The SBIC Program provides funding to all types of manufacturing and service industries. Some investment companies specialize in certain fields, while others seek out small businesses with new products or services because of the strong growth potential. Most, however, consider a wide variety of investment opportunities.  For more information, please visit  The SBIC Program: Seeking SBIC Financing for your Small Business  and  Understanding Equity Capital.   View a list of Small Business Investment Companies.

  • BONDING FOR CONTRACTORS:

The U.S. Small Business Administration is authorized to guaranty bid, payment, and/or performance bonds issued by any company appearing on the Treasury Department's Federal Register list of "Companies Holding Certificates of Authority as Acceptable Sureties of Federal Bonds and as Acceptable Reinsuring Companies." A good source of bonding availability in your area is in the telephone book's yellow pages under "Bonds--Surety & Fidelity." To further assist you (and your agent), we offer the following list of underwriting firms and their contact underwriters, who have indicated a desire to be known as active participants in the Surety Bond Guarantee (SBG) Program.  For more details, please visit What's a Surety Bond.  For questions, visit the SBG Seattle Bond Office.   View a list of Participating Bond Agencies in Oregon.

  • DISASTER LOAN PROGRAMS:

Through its Office of Disaster Assistance (ODA), the SBA is responsible for providing affordable, timely and accessible financial assistance to homeowners, renters and businesses following a disaster.  Financial assistance is available in the form of low-interest, long-term loans.  This includes physical disaster loans, economic injury loans, military reservists' loans and home and personal property loans.  For more information, please visit the Disaster Assistance  home page.

  • FOR LENDERS ONLY:

SBA Information Notice: New Maximum Allowable Fixed Rate for 7(a) Loans
SBA Region 10 Lender Training Web Page  -  Includes Link to FY09 Training Schedule
Loan Servicing:  Lenders' Delegated, Unilateral Servicing Authority
National SBA Banking Page
Lender Forms
Guaranty Application Checklist