America’s Small Business Resource

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The U.S. Small Business Administration

Our MissionAssist small business in getting

started, stay in business and to expand

SBA provides assistance in (3) three major areas Capital AccessCounseling Contracts

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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 lendersdelivered over $683 million in

financing, guaranteed 4,653 loans

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SBA’s Financial Programs

• 7(a) Guaranty Loan Programs

• 504 Loan Program

• Micro Loan Program

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Three (3) Main Reasons Why Lenders Use SBA

• Newer or Start-Up Business

• Collateral

• Longer Repayment Term

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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 - 500 to 1,500 Employees

• Construction $13.0 to $31.0 Million

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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)

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Loan Amounts

Terms and Conditions

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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%

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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

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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

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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

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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

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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

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CommunityExpress Lenders in Illinois

Banco PopularBusiness Loan ExpressChaseFirst American Bank Innovative BankLaSalle BankNational City BankSuperior Financial GroupU.S. Bank

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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

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For More Information on SBA’s Programs & Services ...

• Our National Site is located at www.sba.gov

• Visit the Illinois District Office Website atwww.sba.gov/il

• (312) 353-4528

America’s Small Business Resource