SBA Business Loan Information for Veterans
SBA Implements New Measure to Help Get Small Business Loans Into the Hands of Veterans
The U.S Small Business Administration (SBA) has implemented a new measure to help get small business loans into the hands of veterans. This new measure sets the borrower upfront fee to zero for all veteran loans authorized under the SBA Express program up to $350,000. This initiative started on January 1st, and will continue through the end of the fiscal year.
Of all SBA loans that go to veterans, 73 percent are $350,000 and below. The SBA Express Loan Program, which supports loans under $350,000, is SBA’s most popular loan delivery method, with nearly 60 percent of all 7(a) loans over the past decade being authorized through the program. Since the program’s inception, it has also been one of the most popular delivery methods for getting capital into the hands of veteran borrowers.
This policy announcement means that veteran borrowers will no longer have to pay an upfront fee for any loan up to $350,000 under the SBA Express program. This will make the loans cheaper for the borrower, another way SBA is looking to serve small business owners as they look for ways to access capital.
SBA provides veterans access to business counseling and training, capital and business development opportunities through government contracts. In FY 2013, SBA supported $1.86 billion in loans for 3,094 veteran-owned small businesses. And since 2009, the dollar amount of SBA lending support to veteran-owned firms has nearly doubled.
Guaranty Fee Reduction:
Currently, SBA Express loans of $150,001 to $350,000 have an up-front guaranty fee of 3%. To continue supporting America’s veterans, the SBA Veterans Advantage reduces the up-front guaranty fee from 3% to 0% for SBA Express loans over $150,000 approved to small businesses owned by qualified veterans. This will encourage greater participation in SBA lending programs with a direct benefit to veteran-owned small businesses.
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