WASHINGTON, D.C. – The U.S Small Business Administration (SBA) today announced new measures to help get small business loans into the hands of veterans by setting the borrower upfront fee to zero for all veteran loans authorized under the SBA Express program up to $350,000. This initiative will start on Jan. 1 and continue through the end of the fiscal year.
“Our nation’s veterans are highly-skilled and highly-trained leaders in their communities,” said Acting SBA Administrator Jeanne Hulit. “This initiative will set fees to zero for SBA Express loans to veterans up to $350,000, and is part of SBA’s broader efforts to make sure that veterans have the tools they need to start and grow a business. As we honor our veterans and thank them for their service and sacrifice, let’s continue to identify ways to support them when they come home.”
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.
Building on SBA’s recent announcement that for the current fiscal year, fees on loans for $150,000 and under are set to zero, 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 new initiative will go into effect Jan. 1 and extend for the duration of the fiscal year. 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.
“Certainly, this new incentive will help us bolster our loan activity to the veteran community,” said SBA’s New Jersey District Director Al Titone. “We are excited to add a program that gives real value to veterans who can save up to $7,875 in fees on a loan of $350,000 with a 75 percent guarantee from the SBA.
Titone also noted that prior to the policy changes in fee structures, SBA fees on any loan greater than $150,000 with a maturity of one year or shorter was 0.25 percent of the guaranteed portion of the loan. On loans with maturities of more than one year, the normal fee was 2 percent of the SBA guaranteed portion of the loan and 3 percent of the SBA-guaranteed portion on loans of $150,000 to $700,000.
Today’s announcement comes during SBA’s National Veterans Small Business Week, an initiative on the part of the U.S. Small Business Administration to reach out to veteran entrepreneurs and business owners. During Veterans Small Business Week, SBA staff all across the country have been working with partner organizations on educational efforts, mentoring, and trainings to make sure veterans have the tools they need to start or grow their business.
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.
For more information about these and other SBA programs, visit the SBA website at www.sba.gov, or contact your local SBA field office. You can find contact information for your local SBA office at http://www.sba.gov/localresources/index.html.
Connect with NJTODAY.NET
Join NJTODAY.NET's free Email List to receive occasional updates delivered right to your email address!