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Business Loans for Rural Development

The U.S. Small Business Administration (SBA) is introducing a new 7(a) loan initiative designed to accommodate the unique loan processing needs of small community/rural-based lenders, many of which do not make SBA 7(a) loans or make very few SBA loans.

Small/Rural Lender Advantage (S/RLA) is part of a broader SBA initiative to promote the economic development of local communities, particularly those facing the challenges of population loss, economic dislocation, high unemployment, etc. This initiative is part of the Agency’s 7(a) loan guaranty program and is designed to encourage small community/rural lenders to partner with SBA by simplifying and streamlining the Agency’s loan application process and procedures, particularly for smaller SBA loans.

Key Features of the Initiative:

• A streamlined, simpler, and more user friendly 7(a) process for small loans ($350,000 or less)
• One page application (two sided) for very small loans with key, but limited additional information required for loans above $50,000
• SBA guarantees 85 percent of loans of $150,000 or less and 75 percent of loans greater than $150,000
• Loans centrally processed through SBA’s Standard 7(a) Loan Processing Center
• Expedited SBA processing with routine loans processed within 3-5 days
• Lenders can transmit applications via fax and eventually online
• Simplified SBA loan eligibility questionnaire to help small or occasional lenders meet SBA’s eligibility requirements
• Training on SBA program requirements from local SBA offices

Resources:
· S/RLA Fact Sheet (Coming soon)
· Program Procedures: SBA Notice 5000-1056
· S/RLA Overview in Powerpoint
· S/RLA Forms
- Form 2301-A Small Business Application
- Form 2301-B Application for Guaranty
- Form 2301-C Eligibility Questionnaire
- Additional SBA Forms

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