|
In addition, the SBA was also formed to preserve free enterprise and to strengthen the economy of the country.
The purpose and mission of the SBA is still the same. It helps Americans start businesses. The SBA has a network of offices and partnerships with public and private organizations and helps businesses throughout the US, Guam, Virgin Islands and Puerto Rico.
The Small Business Administration also makes direct loans to businesses. In certain cases, the SBA also loans money to people who are victims of natural disasters. It also tries to get government contracts for small businesses, helps businesses manage, and provides technical and training programs for businesses.
The SBA by itself does not grant loans to small businesses. However, it guarantees against default on certain portions of the loans which are made by banks and financial institutes. SBA loan programs are slightly different from normal commercial business loans. Loans are not usually given to people with bad credit scores and nor are they given to start a business. Instead SBA loans are for longer repayment periods.
A business can qualify for an SBA loan if the yearly payment is same as the previous year’s profit. This is in contrast to a conventional commercial loan where a bank would want the payment for the loan to be no more than two-thirds of the previous year’s profits.
SBA loan programs are perfect for small businesses which otherwise would not qualify to receive loans. The SBA helps business to qualify more easily and offers them more flexible loan terms than banks and financial institutions.
More Articles :
|
