America’s Small Business Resource

2 The U.S. Small Business Administration  Our Mission  Assist small business in getting started, stay in business and to expand  SBA provides assistance in (3) three major areas  Capital Access  Counseling  Contracts

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4 The U.S. Small Business Administration  In FY 2007, SBA Nationally  delivered over $20.6 billion in financing,  guaranteed over 110,000 loans, and  In FY 2007, SBA in Illinois  144 participating lenders  delivered over $683 million in financing,  guaranteed 4,653 loans

5 SBA’s Financial Programs 7(a) Guaranty Loan Programs 504 Loan Program Micro Loan Program

6 Three (3) Main Reasons Why Lenders Use SBA Newer or Start-Up Business Collateral Longer Repayment Term

7 General Eligibility Requirements Size: Must Qualify as a Small Business A Small Business is Independently Owned and Operated Not Dominate in the Field Meets SBA's Employment or Sales Standards Wholesale - No more than 100 Employees Retail or Service - $6.5 to $32.5 Million Manufacturing to 1,500 Employees Construction $13.0 to $31.0 Million

8 Purpose of Loan Purchase Land or Buildings Expansion or Conversion of Existing Facilities To Purchase Machinery & Equipment, Supplies, Materials, or Inventory Working Capital Short Term Asset Based Lines of Credit Debt Refinancing (Under Limited Circumstances)

9 Loan Amounts Terms and Conditions

10 7 (a) Loan Program The Maximum SBA Loan amount Will Not Exceed $2,000,000 The Maximum SBA Share of Any Loan or Guaranty Usually Will Not Exceed $1,500,000 SBA’s Guaranty on Any Loan of $150,000 or Less is Usually 85% SBA’s Guaranty on Any Loan of More Than $150,000 is Usually 75%

11 Loan Maturity Working Capital Loans - Up to 7 Years Machinery and Equipment - Up to 10 Years Construction of Plant Facilities - Up to 25 Years Repayment Usually on a Monthly Installment Basis, Principal and Interest Variations Negotiated to Meet Seasonal Cycles of Business Activity

12 Interest Rates Are Negotiated Between the Applicant and the Lender Based on the Credit Merits of the Application For Loans with a Maturity of Less than 7 Years, the Maximum Rate is New York Prime, Plus 2 1/4 Percent For Loans with a Maturity of 7 Years or more, the Maximum Rate is New York Prime, Plus 2 3/4 Percent Exceptions are Made for Loans Under $50,000 and Express Loans, Which May be Slightly Higher

13 Fees Associated with SBA Loans If the Loan Amount is $150,000 or Less, the Fee is 2% of the Guaranteed Portion If the Loan Amount is More than $150,000, but Less than $700,000, the guaranty fee is 3% of the Guaranteed Portion If the Loan Amount is More than $700,000, the Guaranty fee is 3.5% of the Guaranteed Portion

14 SBA’s Express Program Designed to Increase Capital Available to Businesses Seeking Loans Up to $350,000 Can Also be Used for Lines of Credit Businesses Only Need to Complete Lenders Application No Additional Documentation from SBA No Waiting for SBA Loan Approval Offers a 50% guaranty

15 CommunityExpress  Expedited Loan Processing  Focuses on LMI/New Markets  Maximum Loan Amount is $250,000  Standard 7(a) 75% and 85% Guaranty Applies  Technical Assistance Provided by Lenders

16 CommunityExpress Lenders in Illinois  Banco Popular  Business Loan Express  Chase  First American Bank  Innovative Bank  LaSalle Bank  National City Bank  Superior Financial Group  U.S. Bank

17 Patriot Express  Focuses on Veterans & Spouses of  Expedited Loan Processing  Maximum Loan Amount is $500,000  Standard 7(a) 75% and 85% Guaranty Applies  Lower Interest rate cap – like 7(a)  Generally 2 ¼ to 2 ¾ over Prime

18 For More Information on SBA’s Programs & Services... Our National Site is located at Visit the Illinois District Office Website at (312)

America’s Small Business Resource