Programs for Small Businesses
Small Business Stabilization Program
Beginning on June 15, the Small Business Administration will start guaranteeing America’s Recovery Capital (ARC) loans. ARC loans are deferred-payment loans of up to $35,000 available to established, viable, for-profit small businesses that need short-term help to make their principal and interest payments on existing qualifying debt. ARC loans are interest-free to the borrower, 100 percent guaranteed by the SBA, and have no SBA fees associated with them. As part of the Recovery Act, the ARC program was created as a no-interest, deferred payment loan to help small businesses that have a history of good performance, but as a result of the tough economy, are struggling to make debt payments.
ARC loans will be available through October 15, 2009 and will provide funds to be used for payments of principal and interest for existing, qualifying small business debt including mortgages, term and revolving lines of credit, capital leases, credit card obligations and notes payable to vendors, suppliers and utilities. Repayment will not begin until 12 months after the final disbursement. Borrowers don’t have to pay interest on ARC loans. After the 12-month deferral period, borrowers will pay back the loan principal over a period of five years. ARC loans will be made by commercial lenders, not SBA directly. For more information go to www.sba.gov.
Microloan Program
$6 million in new loan monies for very small loans to start-up, newly established, or growing small businesses. Under this program, the Small Business Administration makes funds available to nonprofit community based lenders which, in turn, make loans to eligible borrowers in amounts up to a maximum of $35,000. Applications are submitted to the local lenders and all credit decisions are made on the local level. New Mexico microlenders include Accion www.accoinnm.org and Wesst Corp www.wesst.org.
Eliminate Fees for 7(a) Loan Guarantee Program
Waive loan fees (3%) for the 7(a) loan program on loans approved between February 17 and December 31, 2009. Loans can be used to establish a new business or to assist in the operation, acquisition or expansion of an existing business. SBA may guarantee up to 90% of 7(a) loans. Loans may be accessed through local lenders.
Eliminate Fees for the 504 Loan Program
Waive loan fees (3%) for all loans between February 17 and December 31, 2009. 504 loans may be used for purchasing land and improvements, including existing buildings, grading, street improvements, utilities, parking lots and landscaping; construction of new facilities, or modernizing, renovating or converting existing facilities; or purchasing long-term machinery and equipment. Loans can be accessed through the Enchantment Lands Certified Development Company (505)-843-9232 or www.elcdc.com.
BIA Indian Loan Guarantee Program
$10 million in loans for Indian-owned businesses that benefit the economy of an Indian reservation. Administered by the US Department of Interior/Bureau of Indian Affairs.