2. Virginia Small Business Financing Authority
Works with banks to help them provide loans to small businesses;
Provides direct and indirect loans;
Administers a grant program which provides grants to individual investors who are investing in small businesses.

3. Direct Loan Programs SWaM Business Micro-loan Maximum $10-25k
48 month repayment
$100 fee, 6.50% fixed rate
Any business purpose other than investment real estate
Must have been operational at least 2 years
Owners’ credit scores must be at least 650 each

4. Direct Loan Programs Economic Development Loan
Maximum 40% of total project cost not to exceed $500K (dollar amount may be higher if project in designated distressed area)
For real estate & improvements, furniture/fixtures/equipment, permanent working capital
$500 application fee, recent fixed rate 4%
Start up or existing business
Focus on acceptable job creation/retention relative to loan amount

5. Direct Loan Programs Child Care Loan
Maximum $150K per location for centers, $10K for home based providers
60 month repayment
Borrower must be licensed & in good standing with VA Dept. of Social Services.
Funds materials, equipment, supplies, playground, mini-buses, fencing
$100 application fee, 4% max fixed rate

6. Bank Credit Support Programs
Indirect Loans
Bank underwrites/commits to loan subject to VSBFA involvement.
Cash Collateral-VSBFA pledges cash collateral to the bank to help back a business loan
Maximum $500k or 40% of the loan amount, whichever is less.
Maximum involvement—5 years for term loans, 3 years for credit lines
Cost $200 application fee
Loan Guaranty-VSBFA provides an additional guaranty to the bank
Maximum 75% of the loan amount or $750K, whichever is less
Maximum involvement-7 years for term loans, 5 years for credit lines
Cost $200 application fee, 1.5% of the guaranteed portion

7. How Should you Interact with the VSBFA
How Should you Interact with the VSBFA? (if you need more than $25,000 or not licensed child care)
Step #1: Talk to your banker
Step #2: If the bank understands your request, believes your business can repay, but it feels it needs some help in approving the loan due to:
Weak collateral value
“Blip” in the historical financial performance
Personal guarantees offered are not sufficient
Perceived to be a “high risk” industry
Lending against “specialized” equipment
Etc.
Step #3: Have your banker call the VSBFA
We may be able to offer Cash Collateral, a Loan Guaranty, or participate as a subordinated lender to improve
the bank’s loan to value or help your cash flow

8. Before you go see your Banker about a Loan, be prepared
Have a Business plan (if you don’t have one, contact your local SBDC for assistance in developing one)
Know your borrowing need
Know why that amount is necessary & what you plan to do with it
Know how you will pay it back and when
Know how much you &/or your investors will be contributing
Have the documentation to support all of the above
Tax Returns – Business & Personal
Financial Statements – Business & Personal
AR aging, accounts payable, inventory turn time (if applicable)
Financial Projections

9. Be Realistic & Be Able to Explain How Your Business will Repay the Loan

10. Cultivate a Relationship with your Banker
The better your banker knows you and your business, the better your chances
Build a relationship with your banker just like you would your CPA or your attorney
But also…talk to more than one
mutually beneficial relationship
All VSBFA Programs
Response time once VSBFA has received all required information: 1 week if VSBFA exposure is no more than $500K, approximately 1 month if VSBFA exposure exceeds $500K.
Existing companies must have history of profitable operations & satisfactory debt payment.
Start ups must have business plans & projections.
VSBFA requires guarantees & pledge of all available business & personal collateral.
Cash equity expected.
VSBFA programs cannot be used to compensate for fundamental business weakness.
No prepayment fees or closing costs aside from direct transaction costs.
All real estate loans are “owner occupied commercial real estate.” No investment or residential.
Limited ability to participate in business transfer loans financing goodwill.
WEBSITE:

11. Contact WEBSITE: www.vabankers.org/VSBFA
Nathalia Artus, Regional Lending Manager
mutually beneficial relationship
All VSBFA Programs
Response time once VSBFA has received all required information: 1 week if VSBFA exposure is no more than $500K, approximately 1 month if VSBFA exposure exceeds $500K.
Existing companies must have history of profitable operations & satisfactory debt payment.
Start ups must have business plans & projections.
VSBFA requires guarantees & pledge of all available business & personal collateral.
Cash equity expected.
VSBFA programs cannot be used to compensate for fundamental business weakness.
No prepayment fees or closing costs aside from direct transaction costs.
All real estate loans are “owner occupied commercial real estate.” No investment or residential.
Limited ability to participate in business transfer loans financing goodwill.
WEBSITE: