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					          YOUR
 SMALL BUSINESS RESOURCE
   Leroy Harris       Robert McLoone
     Business Development Specialists
  U.S. Small Business Administration
 400 North 8th Street, Richmond, VA 23219
             (804) 771 2400
         Leroy.harris@sba.gov
       Robert.mcloone@sba.gov

       WWW.SBA.GOV/VA
  2008-2009 - SCORE
Small Business Workshop                     1
What DO THESE COMPANIES HAVE
        IN COMMON???




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www.sba.gov/va
www.sba.gov
www.sba.gov
 FINANCIAL ASSISTANCE
•SBA does NOT provide grants
    www.grants.gov or www.cfda.gov
Grants are a form of funding for specific federal research and social programs.
Contrary to popular belief, there are no federal grants made specifically for the
purpose of starting a business.


•SBA does NOT make DIRECT loans
    except under its Disaster lending

•SBA DOES PROVIDE:
    Loan Guaranty to banks to encourage
    banks to make loans to businesses
Financial Assistance

•7(a) Loan Program
  Term    Loans
  Lines   of credit
  Fixed   and variable rated



•504 Loan Program
  Long    Term Fixed Rate only


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       Financial Assistance
     504 & 7(a) Loan Guaranty
            SBA General Eligibility Criteria

   Must be for profit
     Not engaged in lending, real-estate development,
     investments or speculation

   Must be small www.sba.gov/size
   Must have a sound business purpose
   Good Credit www.annualcreditreport.com
   Good Character
   Equity Investment (Reasonable)
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     Financial Assistance
      7(a) Loan Guaranty
   Loan proceeds can be used for
  any reasonable business purpose
Equipment         Debt refinancing
Inventory         Business purchase
Working Capital Real estate
             Franchise
    (www.franchiseregistry.com)
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     Financial Assistance
      7(a) Loan Guaranty
    SBA Loan Maturity policy*
   Working Capital               5-7 years

   Real Estate                   up to 25 years

   Machinery             useful life of asset

   Just about everything else is 10 years


*Shortest term reasonable but with maximum maturities allowable 10
      Financial Assistance
       7(a) Loan Guaranty
  SBA Interest Rate policy
 Terms < 7 years: Prime +2 1/4%
 Terms > 7 years: Prime +2 3/4%


  Higher Rates MAY apply for:
     SBAExpress Loans &
     Loans <less $50,000
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     Financial Assistance
      7(a) Loan Guaranty
  Maximum $2,000,000 loan limit

-SBA CommunityExpress - $250,000
   (Generally limited to 5,000 - $25,000 up to $50,000)


-SBAExpress:                               $350,000

-SBA PATRIOT Express:                    $500,000

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     Financial Assistance
      7(a) Loan Guaranty
             SBAExpress
 Uses lender‟s forms — not SBA‟s

 Loans or lines of credit to $350,000
           (Export Express up to $250,000)


 SBA guaranty of 50%

 36-hour response from the SBA
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       Financial Assistance
    Community Express Loan
          Program
• Loans up to $250,000
    Historically however loans have been
     $5,000 - $25,000 up to $50,000
•   No business plan or collateral in some cases
•   No early payment penalty.
•   Seven years term.
•   MUST Contact a T/A Provider for
                Technical Assistance
      FOR ADDITIONAL INFORMATION GO TO
              The “Financing" link at
           WWW.SBA.GOV/VA
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•Loans are available up to $500,000
•SBA maximum guaranty:
   •85 percent for loans of   $150,000 or less
   •75 percent for loans over $150,000

•ALL loans above $350,000:
  Lenders required to take all available collateral


  The Patriot Express loan can be used:
  • most business purposes
  • start-up or expansions
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   Financial Assistance
         504 Loan Program
        Certified Development Companies
             Maximum
    SBA/504 Debenture Financing***

                 $1,500,000
 $2,000,000 for Public Policy Loans
 $4,000,000 for Small Manufacturers

***Excluding the bank financing and equity injection
FOR A LIST OF MICRO LENDERS IN VA
  www.sba.gov/va “Financing” Link                      16
   Financial Assistance
          504 Loan Program
         Certified Development Companies

         Typical 504 Structure
Bank financing MUST fund 50% of cost
  CDC/SBA up to 30-40% of project
  Business normally invests 10-20%
     •   Fixed asset financing only
     •   Long term - 10 or 20 years
     •   Low fixed rate of interest
     •   Generally requires job creation
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         Financial Assistance
           Other Financial Assistance Programs

        MICRO LOAN PROGRAM
   SBA loans money to intermediary lender
   The Intermediary lends up to $35,000
   Intermediary provides management assistance

    •   May not be used for real estate
    •   May not be used for debt payment
    •   Maximum term is 6 years
    •   The average loan is $10,000 - $15,000
        FOR A LIST OF MICRO LENDERS IN VA
          www.sba.gov/va “Financing” Link        18
Financial Assistance ABC’s

Ability to Manage
Business plan that makes sense
Cash Flow aka Repayment ability
Collateral (to the extent it is available)
Credit that is reasonable

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      GET STARTED
         Before going to a lender for a loan:
• Obtain a copy of your credit report
       • Clear up any errors
       • Clear up any derogatory information
       • GET your accounts current
• Do your research
• Prepare a Business Plan
                GET HELP !!!!
                 (SCORE - SBDC - WBC)
               Contact an SBA Lender:
              List of active SBA lenders in VA

            www.sba.gov/vets
                    click on „Financing”



       SBA RESOURCE GUIDES
          www.sbaguides.com                      20
        SBA’s
TECHNICAL ASSISTANCE
 RESOURCE PARTNERS
         SCORE
         11 chapters in Virginia
         www.score.org


         VA Small Business
         Development Centers
         29 centers in the Virginia
         www.virginiasbdc.org

         Women‟s Business Centers
         Richmond and Springfield, VA
         www.nvnv.org
         www.wbcnova.org

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