How the government plans to help small businesses through SBA loans

If you have ever considered opening a new business, you soon realize that coming up with a “great product” is only half the battle. You have to either use your own cash, or do what most people do who are trying to create and live the American dream; you barrow other people’s money to make money.

In earlier years it may have been easier to convince your parents to dip into their retirement, sell some stocks, or refinance THEIR home in order to obtain some capital to get started on your new business venture. Especially if they lived in St. George, Utah, because in 6 months their home would easily appreciate $60,000 right? Today you are lucky if you can get your parents to stay on the phone with you for more than 5 minutes because lets’ face it, cell phone minutes don’t grow on trees-

In the news you hear of how the new Stimulus package is going to help out some of the large companies, but what hasn’t been emphasized is that $730 million of that will go towards the SBA, and will give them the ability to help some of the smaller business both here in St. George, and across the nation.

Darryl K Hariston who is the acting SBA Administrator said, “We are going to be part of the solution, and this bill gives us specific tools to make it easier and less expensive for small businesses to get loans, give lenders new incentives to make more loans, and help restore healthy SBA secondary markets to boost liquidity.”

According to the SBA, the funds will be allocated accordingly:

• $375 million for temporary fee reductions or eliminations on SBA loans and increased SBA guaranteed shares, up to 90 percent for certain loans
• $255 million for a new loan program to help small businesses meet existing debt payments
• $30 million for expanding SBA’s Microloan program, enough to finance up to $50 million in new lending and $24 million in technical assistance grants to microlenders
• $20 million for technology systems to streamline SBA’s lending and oversight processes
• $15 million for expanding SBA’s Surety Bond Guarantee program
• $25 million for staffing up to meet demands for new programs
• $10 million for the Office of Inspector General

As St. George Utah has seen its share of national tenants who have struggled and ultimately closed their doors, this might be a boost that will help some of the local business owners continue to operate in a tough economy.

This entry was posted on Wednesday, March 4th, 2009 at 4:06 pm and is filed under St George Growth. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.