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U.S. Small Business Administration

U.S. Small Business Administration. SBA Loans to Finance & Expand Your Business Rhonda Fisher Mississippi District Office. SMALL BUSINESS: Discover New Possibilities!. SBA & America’s Entrepreneurs A Partnership for the 21st Century. 7(a) Loan Guaranty Program. Reduces Lender’s Risk

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U.S. Small Business Administration

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  1. U.S. Small Business Administration SBA Loans to Finance & Expand Your Business Rhonda Fisher Mississippi District Office

  2. SMALL BUSINESS:Discover New Possibilities!

  3. SBA & America’s EntrepreneursA Partnership for the 21st Century

  4. 7(a) Loan Guaranty Program • Reduces Lender’s Risk • Assures Repayment • Helps 1000s obtain financing

  5. SBA Mission Statement Maintain and strengthen the nation’s economy by aiding, counseling, assisting and protecting the interests of small businesses and by helping families and businesses recover from national disasters.

  6. SBA Programs And Services Information to Start and Run your Business Financial Assistance Federal government Contracting Assistance Business Training and Counseling Disaster Assistance

  7. 7 (a) Guaranteed Loan Program Basic 7(a) SBA Express Patriot Express Gulf Opportunity CAPline Export Working Capital International Trade Export Express Small Loan Advantage Microloan Program 504 Loan Program SBA Loan Programs

  8. 7(a) Program • Maximum loan $5 Million • 85% guaranty up to $150,000 • 75% guaranty above $150,000 up to $5 Million

  9. Eligibility Factors to Consider: • Size and Affiliation • Type of Business • Use of Proceeds

  10. Size… • Applicant and all affiliates must: • Have a Net-worth less than $15,000,000 • Have Net-profit (after taxes) less than $5,000,000

  11. Eligible Type of Business: • A Business must be For Profit • One that is Located in the United States • Owned by U.S. Citizens or legal permanent residents

  12. Ineligible Businesses • Gambling • Real Estate Investment • Speculation • Lending Activities & life insurance companies • Businesses selling through a pyramid plan • Illegal Businesses • Non-Profit Organizations • Businesses providing prurient sexual material • Businesses which restrict patronage • Businesses owned by individual(s) on probation, parole and with pending criminal charges

  13. Eligible Uses of an SBA Loan • Any Legitimate Purpose • Construction • Land & Building • Line of Credit • Leasehold Improvements • Machinery & Equipment • Expansions & Renovations • Inventory & Working Capital • Refinancing Business Debt • Purchasing of Existing Small • Business

  14. Speculation Partial Change of Ownership Payment to Principals Delinquent Payroll/Sales Taxes Ineligible Uses of Loan Proceeds SBA Loan

  15. 7(a) Continued • Fees • 2% $150.0 • 3% $150.1-$700.0 • 3.5% 700.0+ • 3.75% for the portion in excess of $1.0 Million

  16. Collateral • Personal Guaranty from 20% + owners • A 7(a) loan must be fully secured (or secured to the extent possible) with available collateral (both business and personal).

  17. What to take to the Bank BUSINESS PLAN • The Company • Products & Services • Marketing Strategy • Operations • Management • Proposed Financing • Financials

  18. Mississippi Small Business Development Centers MSBDC State Office B-19 Jeanette Phillips Drive University, MS 38677-1848 (662) 915-5001 FAX: (662) 915-5650 Toll-Free in MS: 1-800-725-7232 e-mail:msbdc@olemiss.edu Website: www.mssbdc.org See Page 10 of the Resource Guide for the Center nearest you!

  19. http://www.sba.gov/smallbusinessplanner/index.html

  20. What SBA Looks For: • Good Character • Feasible Business Plan • Management Expertise & Commitment • Sufficient Funds to Operate on a Sound Financial Basis • Adequate Equity • Repayment Ability

  21. SBAExpress • Underwriter uses own forms • Use bank’s lending policies • Loans or revolving lines of credit to $350,000 • SBA guaranty is 50%

  22. SBA Express Lenders… Page 19 of the Resource Guide

  23. SBA Patriot Express Loan Program • Loans up to $500,000 • 75% to 85% guarantee • Veterans • Transition Assistance Program Active Duty Eligible • Reservists/National Guard Current Spouses of any of the above • Widowed spouse of service member or veteran who died during service or of a service connected disability

  24. Gulf Opportunity Pilot Loan Program (GO Loan) • Targeted Relief for Small Businesses up to $150.0 • SBA’s Most Favorable Guarantee • Streamlined Paperwork for Lenders & Borrowers

  25. GO Loan Eligible Counties Adams Amite Attala Carroll Choctaw Claiborne Clarke Clay Copiah Covington Franklin Forrest George Greene Hancock Harrison Holmes Humphreys Hinds Issaquena Jackson Jasper Jefferson Jefferson Davis Jones Kemper Lamar Lauderdale Lawrence LeakeLeFlore Lincoln Lowndes Madison Marion Monroe Montgomery Neshoba Newton Noxubee Oktibbeha Pearl River Perry Pike Rankin Scott Sharkey Simpson Smith Stone Sunflower Walthall Warren Washington Wayne Webster Wilkinson Winston Yazoo

  26. Other SBA Loan Programs Exporting • International Trade Loan Program • Export Express Loan Program • Export WC Loan Program Self Liquidating Lines of Credit • Contractors • Seasonal Businesses • Business that sells on credit

  27. SBA Contractor’s Capline • Finances the labor and material costs of the specific contract(s) being financed. Proceeds cannot be used to cover overhead or general and administrative expenses • Proceeds from the contract receivable assigned to lender • Are able to demonstrate an ability to operate profitably based upon the prior completion of similar contracts

  28. SBA 504 Loan Program Long Term Fixed Asset Financing Local lender 50% SBA/CDC 40% Small Business 10%

  29. 504 LOANS - LOAN LIMITS • $5.0 Million Maximum SBA/CDC share • Up to $5.5 Million for manufacturing

  30. CERTIFIED DEVELOPMENT COMPANIES Central Mississippi DevelopmentCompany, Inc. Thelman L. Anderson P.O. Box 49351170 Lakeland DriveJackson, Mississippi 39296-4935Telephone: (601) 981-1625Fax: (601) 981-1515Business Email: landerson@cmpdd.org Three Rivers Local DevelopmentCompany, Inc. Vernon R. Kelley, Executive Director P.O. Drawer B75 South Main StreetPontotoc, Mississippi 38863Telephone: (662) 489-2435Fax: (601) 489-6815Business Email: threerivers@trpdd.com

  31. Small Business Counseling and Training – Partners at Work • Small Business Development Centers (SBDC) www.sba.gov/sbdc • Service Corps of Retired Executives (SCORE) www.score.org • Women’s Business Centers www.sba.gov/services/

  32. SBA Online Assistance • www.sba.gov – Main SBA Website • www.sba.gov/ms - DistrictWebsite • www.business.gov – Business Gateway for Federal Resources, Legal & Regulatory Assistance • www.sba.gov/vets - Veteran Website • http://www.sba.gov/onlinewbc/index.html – Online Women’s Business Centers • www.franchiseregistry.com – SBA Franchise Registry • www.sba.gov/teens - Teen Entrepreneur Guide

  33. Contact Us! • SBA Mississippi District Office 601-965-4378 • SBA Gulfport Branch Office 228-863-4449 • SBA Answer Desk 1-800-8-ASK-SBA

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