Bob Polito, director of government-guaranteed lending for Webster Bank, already has three veterans waiting to apply for the U.S. Small Business Administration’s new Patriot Express loan.
The pilot loan program – announced last week by the SBA’s Rhode Island District office in Providence – offers veterans, service-disabled veterans, active-duty service members in the military’s Transition Assistance Program, reservists and National Guard members and spouses, both current and widowed, access to up to $500,000 in SBA-guaranteed loans.
The loans can be used to start a small businesses or for expansions, equipment and inventory purchases, working capital or business-occupied real estate purchases.
The loans feature the SBA’s lowest interest rates – 2.25 percent to 4.75 percent above the prime rate – and the SBA’s maximum guarantee – up to 85 percent for loans of $150,000 or less and 75 percent for loans between $150,000 and $500,000.
In addition, the applications for these loans will be submitted electronically, making turnaround possible within 24 hours, said Norm Deragon, veterans’ development officer for the district office.
“I have not one criticism of the product,” said Polito, who is also a veteran. “And I couldn’t add anything to make this better.”
The veterans Polito has lined up for the loan are seeking to broaden their business scope, he said. They want to buy inventory and hire more people.
Deragon said the SBA will start accepting loan applications on Thursday. He added that any veteran, including those who have served 180 days of active duty and were honorably discharged, are eligible to apply.
“The really huge part of this is that it’s available to spouses,” he said. “This is the first time [a loan] is available to spouses.”
Gary Heidel, SBA director of Citizens Financial Group, said he expects the military-targeted program will pique interest in SBA-backed products from other consumers.
“It shows the SBA is out there trying to assist small businesses,” he said. “They are modifying their programs to assist various segments of the market.”
Heidel said he also expects the program will spur other agencies and organizations that offer services to veterans to rev up their marketing of those services. He got that impression from listening to comments from the audience at the national announcement of the Patriot Express loan program in Washington, D.C.
U.S. Senators Jack Reed and Sheldon Whitehouse, U.S. Rep. James R. Langevin, Rhode Island Lt. Gov. Elizabeth H. Roberts, Maj. Gen. Robert Bray from the R.I. National Guard and about a dozen SBA lenders attended last week’s local announcement in support of the initiative, Deragon said.
