SBA: Loan programs on the mend

WASHINGTON – The U.S. Small Business Administration says its loan programs have rebounded now that the federal stimulus package has lowered fees and boosted guarantees.
Since the American Recovery and Reinvestment Act was signed in February, the SBA has backed more than $11.3 billion in lending. The agency’s average weekly dollar volume has increased by more than 60 percent since February.
In addition, the average number of loans approved per week has increased by more than 50 percent. The dollar volume for September 2009 – $1.9 billion – was the highest single-month total since August 2007.
“These numbers, along with our conversations with lenders and small business owners around the country, show that the Recovery Act hit the mark,” SBA Administrator Karen Mills said. “The Recovery Act was critical to unlocking the market and as a result we’ve helped put billions of dollars of much needed capital in the hands of small business owners during this tough economic time, and brought more than 1,200 lenders back into SBA’s loan programs. With half the nation’s work force either working for or owning a small business, these dollars played a critical role in driving economic recovery across the country.”
The SBA had experienced a decline in lending late last year because of a credit squeeze. In early 2009, the agency’s average weekly dollar volume was $165 million. The average weekly average since the Recovery Act was signed, through Sept. 25, was $275 million.
Mills cited Recovery Act provisions that reduced fees on SBA loans and raised SBA guarantees to 90 percent, as well as actions that reinvigorated the secondary markets for SBA-guaranteed loans as especially helpful in improving access to SBA-backed credit.
For more information about the SBA long programs, visit www.sba.gov or contact a local SBA field office.