SBA Places Emphasis on Loan Guarantees for the Entertainment Industry

Ruben Garcia, District Director of the San Diego District Office of the U.S. Small Business Administration announced a new application for an existing loan program today, especially targeted to those in the entertainment industry that want to further develop and expand their small businesses.

The need for this application was brought to the SBA’s attention by SCORE Counselor, Jocelyn Celaya, who worked with SCORE clients who needed capital to expand their businesses. Celaya is a classical guitarist who also owns her own business, Radical Classical Recordings.

The SBA will utilize the Community Advantage Loan program to guarantee loans made by SBA Lenders. This is generally a loan made for between seven to 10 years, unless real estate is purchased, then the term of the loan is for 25 years. Loan amounts range from $20,000 to $250,000. Interest rates are based on Prime plus between 2.75 and 6 percent. Having collateral is not necessarily a criterion for the loan. The SBA guarantee allows the lender to make loans that otherwise may not be made due to risk.

There are some restrictions on the use of loan proceeds; funds may not be used for speculation, network marketing, endorsement of a particular religious belief or production and distribution of materials that are of sexual prurient nature. All restrictions are detailed in 13 CFR 120.110.

“We are excited about finding a way to serve the entertainment industry’s needs for access to capital and have SBA Resource Partners available to provide no cost assistance in developing business plans, financial forecasts and marketing plans,” said Ruben Garcia. “We appreciate Jocelyn Celaya’s willingness to bring this need to our attention and work with us to find a solution,” he added.

For additional information about the Community Advantage Loan program and a list of lenders visit: https://www.sba.gov/content/community-advantage-loans