Thursday, February 25, 2010
SBA - ARC Loans
Your company must be a distressed business in order to qualify. The primary purpose of the ARC loan is to help small businesses weather a recession or restrictive credit-induced downturn and regain profitability. More specifically, what led to a distressed business includes:
"Reduction in customer base
Increase in cost of doing business
Loss/reduction of working capital and/or loss/reduction of short term credit facilities
Inability to restructure existing debts due to credit restrictions
Loss/reduction of employees (intellectual capital)
Loss/reduction of major suppliers (major suppliers out of business)"
(again, a direct quote from the SBA website!)
For more information, such as a list of approved SBA lenders, go to SBA Arc loans.
I wish you the best in accessing funds. Everything I've said in the past about banking relationships still apply. You're likely to procure the loan much faster if you already have an established relationship with someone at the VP (NOT Asst. VP) level or above. If not, mine your contacts for an introduction!
Finally, one note, Bank of America is a big SBA lender but, according to the WSJ article, they aren't participating in the ARC program. This is as expected. Bank of America had a strategic partnership with CIT and routed the majority of their smaller SBA loans (under $250,000) to CIT. Since CIT filed and later, emerged from bankruptcy, I'm not sure if that strategic partnership still exists, and if it does, if it's still structured the same way. Perhaps I should check on this?
Good luck!
Subscribe to:
Post Comments (Atom)
1 comment:
It's great to see fresh, creative ideas that have never been done before.
Post a Comment