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Florida Small Business Development Center Network Receives National Accreditation

admin — Fri, 09 Jul 2010 16:51:00 +0000

Accreditation is critical for the SBDC to secure continued funding from the U.S. Small Business Administration (U.S. SBA), and is also essential for the national SBDC program to be recognized as a high quality economic development organization. On May 31, 2010, the Florida Small Business Development Center Network (FSBDC Network) was notified that the statewide network has received full accreditation by the national accrediting agency—the Association of Small Business Development Centers (ASBDC). The SBDC at the University of North Florida is a member of the Florida SBDC Network. No other publicly-funded program undergoes the annual accountability examinations and review that SBDCs receive to ensure management strength, financial accountability and economic impact. Read more about the FSBDC Network’s Accreditation at: http://www.floridasbdc.org/.

Copyright © 2009 Small Business Resource

Florida Small Business Development Center Network Receives National Accreditation

Florida Oil Spill:SBA Economic Injury Disaster Loan Program Activated

admin — Mon, 17 May 2010 14:00:00 +0000

SBA Economic Injury Disaster Loan Program Activated

In response to the Deepwater BP Oil Spill, the SBA has authorized the activation of the Economic Injury Disaster Loans (EIDL) program for the counties included in the attached SBA Press Release. The SBA is setting up an office in Pensacola at the SBDC at UWF Center located at 401 E Chase St, Ste 100 beginning on Tuesday, May 18. One of the Mobile Assistance Centers (MACs) will also be on site and could be deployed elsewhere if the need arises. The other MAC will continue with its previously scheduled events in Ocala, Indian River and Orlando over the next few weeks, but may be pulled if the situation calls for it. Paymon Shokoohi will be in contact with the FSBDCN Business Response & Recovery Team (BRRT), as there may be a need for additional CBAs to respond.

Contact Paymon Shokoohi with questions or for more information at: paymon.shokoohi@floridasbdc.org or 850.473.7820.

SBA loan fees returning

admin — Mon, 22 Feb 2010 20:51:00 +0000

Thanks to Florida First Capital Finance Corporation for this update that indicates the funds for eliminating soft costs for SBA 7a and 504 loans are exhausted so we are returning to the pre-ARRA regulations unless the Obama jobs bill is passed. The bill includes a provision to eliminate loan fees through September 2010. Read on…

The Small Business Administration (SBA) has announced plans to simultaneously wind down the temporary enhancements for the 504 and 7(a) programs and bring both programs back to pre American Recovery and Reinvestment Act (ARRA) terms.

In December, Congress and President Obama extended the temporary elimination of most up-front program fees for 504 and 7(a) loans as well as an increased guaranty percentage on 7(a) loans. Those enhancement funds, however, are now exhausted. Given this, the SBA has re-activated its Recovery Loan Queue effective Monday, Feb.22.

As was the case in November, 504 applications submitted as Recovery Act loans will be processed up to the point of approval and then will be placed into the queue awaiting the availability of funds. Sometimes previously approved loans are later cancelled or never disbursed for a variety of reasons.

The queue takes this into account and will allow eligible small businesses, in consultation with their lender, to choose to be placed in this queue for possible approval if funding becomes available. Small business owners and lenders will have transparent access to the queue via www.sba.gov/recoveryq and will be able to remove themselves from the queue at any time to be considered for a non-ARRA SBA loan with all applicable fees.

Through the original $375 million and the additional $125 million in appropriations for the temporary enhancements for both programs, the SBA has supported more than $20 billion in lending to small businesses across the country and seen its average weekly loan volume increase by nearly 90% since February 2009.

Currently, the SBA and Obama Administration are working closely with Congress to secure passage of the Jobs Bill, which contains an additional $354 million to extend the program fee eliminations through Sept. 30, 2010. That bill also contains provisions that would increase the cap on 504 loans to $5 million for standard small businesses and $5.5 million for small manufacturing businesses. 504 loan caps are currently set at $1.5 million ($2 million if a public policy is met) and $4 million, respectively.

The Obama Administration also recently proposed further legislation to temporarily allow for the refinancing of owner-occupied commercial real estate loans under the 504 program. Currently, 504 loans cannot be used for the refinancing of maturing debt. This change would respond to the difficulties many current, solvent borrowers face in refinancing existing commercial real estate loans.

Under the proposal, businesses with a loan maturing in the next year and who are current on all loan payments would be eligible. Lenders that are refinancing mortgages for existing customers would make a loan for up to 70% of the current property value; and the SBA will help finance the remaining 20%.

For new lenders taking on a refinancing project, the SBA would take on a greater share of financing, up to 40%. The SBA’s proposal for a temporary, zero-subsidy commercial real estate refinancing program would be funded through additional fees for refinancing projects, not through a Congressional appropriation. This proposal will help refinance up to $18.7 billion each year in commercial real estate that might otherwise be foreclosed and liquidated.

SBDC’s get their funding…

admin — Tue, 26 Jan 2010 18:32:00 +0000

The Small Business Administration will provide more assistance and capital to small businesses. The FY 2010 Appropriations Bill shows the SBA will receive $824 million which is $212 million above 2009 and $45 million above the request. Highlights include:
· Overall Lending: Supports $28 billion in new lending to small businesses
· Microlending: $25 million in new microlending. $22 million in related assistance
· SBDCs: $113 million ($3 million above 2009, $16 million above the request)

See the appropriations summary here

Small Business Lending Making a Comeback?

admin — Tue, 05 Jan 2010 17:43:00 +0000

It appears that the SBA is showing an increase in the number of government backed loans. In the last quarter of 2009, the SBA backed over 12,000 7a loans as compared to the same quarter in 2008 where the total was only 9,000.

While encouraging, the last quarters numbers are quite a bit lower than the 20,000 loans guaranteed for the same period of 2007. Lets hope the upward trend continues.

According to a CNNMoney.com article on SBA lending, “SBA loans represent a tiny portion of the overall small business lending landscape, but they’re an important barometer of banks’ willingness to extend credit to startups and growing companies.”

Small Business Link of the Week: SBA Online Learning

admin — Thu, 02 Jul 2009 13:03:00 +0000

The SBA has a series of free online small business training sessions you can take at your convenience. Available courses include Starting a Business, Surviving in a Down Economy, Business Management and Financing and Accounting. You can learn about the specific courses by clicking, “About these Courses.” In general, the courses are all self-paced and should take about 30 minutes to complete. Most of the courses require a brief online registration.

These short courses make for a great primer on small business subjects, but should not be used in place of live courses which are far more thorough.

SBA Online Learning

Small Business: Summer Checkup for Profitability

admin — Sat, 27 Jun 2009 11:53:00 +0000

Sound advice from Joyce M. Rosenberg in this recent Associated Press article. Many of our clients are assessing their financial situation and taking a mid-year look at the bottom line. But what about networking? That is worth some analysis as well. We advise clients to reach out to current and former clients. Recently a business owner we are working with visited a customer just to thank him for their business. The result? Two new contracts that couldn’t have come at a better time. We have a reputation at the SBDC for helping businesses with financial assessment, but we also excel at networking. Consider coming in and we can get you back in front of the right people again. The ones who can give you business.

Small companies need holistic midyear checkups

Small business owners might want to put two important items at the top of their midyear to-do lists: get a financial checkup, and do more networking.

Early July is a good time for owners to plan for the rest of the year. But the recession has likely chilled many companies’ plans to expand or make big capital expenditures. And many owners have already have done as much cost-cutting as they could to help their companies weather the poor economy.

So, many of the savvy owners who schedule midyear financial checkup appointments with accountants or tax attorneys are likely to be seeking other kinds of guidance as well, such as finding ways to bring in more sales.

Certainly, there are financial issues to discuss, especially since there are new federal and state laws designed to help companies during the recession. Joseph Maloney, a certified public accountant with Maloney Reed Scarpitti & Co. LLP in Erie, Pa., noted that businesses may be able to reduce their quarterly estimated tax payments, which would help those with waning cash flows.

Maloney said more tax law changes may be in the offing, and he suggested owners not only see their financial advisers now but keep in touch to “see what adjustments might have to be made” for the rest of 2009.

But a thorough midyear checkup will always go beyond taxes and cutting expenses, and touch on a company’s strategy. This year, Maloney said, many owners are having to brainstorm with their advisers about ways to bring in new business, especially with the drastic changes in industries such as financial services and autos.

“I’ve gotten out of the auto line (of business) and I need to get into some other line,” is the type of problem that accountants and attorneys are hearing, Maloney said. “They almost have to reinvent themselves.”

Financial advisers are also a natural place for owners to begin networking. Those who specialize in working with small businesses are often able to bring together clients who need each other’s products or services.

Chambers of commerce and trade or entrepreneurs’ associations are also good places to go. So are trade shows, and many owners are making a point of going to more of them this summer.

“You never know who you’re going to meet and where, so think outside the obvious networking places,” said Leon Dutkiewicz, a CPA with Margolis & Co. in Bala Cynwyd, Pa. For example, he said, owners shouldn’t go just to the standard trade shows and should consider international expos that are often held in big cities.

Summer is also a good time to find and join a networking group. Many groups hold summer parties and other events, and most are always seeking new members.

Like a chamber of commerce, a networking group will bring together owners from diverse industries. They’re not hard to find — talk to a handful of business owners, and at least one is sure to be part of a networking group. Searching the Internet will also quickly yield the names of groups that are either nearby or online.

Your financial adviser may also be a networker. “It’s something that I personally believe in,” Dutkiewicz said.

Networking doesn’t have to be through an organized group. Owners taking their children to Little League games and other sports can get leads or customers through casual conversations with other parents. Some business owners make connections while waiting on cashiers’ lines in stores. Events to mark the Fourth of July are also fair game for networking.

There are also networking possibilities at the Small Business Administration’s Small Business Development Centers, located at many colleges around the nation. These centers exist to help and advise small companies, and many SBDCs offer low- or no-cost classes and seminars, even during the summer. That can give an owner a chance to learn new skills, get some ideas and also do some more networking.

If you are looking for a Small Business Development Center, they can be located through the SBA’s Web site at http://www.sba.gov/aboutsba/sbaprograms/sbdc/index.html.

ARC Loans: Not Everyone Will Get One..

admin — Wed, 24 Jun 2009 20:30:00 +0000

Mark Deo writes in this Reuters piece (with a nod to Entrepreneur.com) about the hesitancy of banks to play in the SBA’s ARC loan arena. We have a number of ARC loans going in for approval and if our clients do indeed receive funding to pay down debt, it may well be the difference between sustainability and failure.

Will Anyone Be Saved by the SBA’s New ARC?

On June 15, banks began taking applications for the America’s Recovery Capital loan program. The ARC loan is a $35,000, interest-free, deferred-payment loan, fully guaranteed by the Small Business Administration and available to established, viable, for-profit small businesses suffering “immediate financial hardship.”

The goal is to help provide some temporary financial relief so small businesses can keep their doors open and put their cash flow back on track.

Banks, however, are hesitant to participate in this program.

According to Investment Watch,a leading economic report, “While banks have ample capital and improved liquidity, their credit standards remain tight. They are lending, but only to A/A+ customers as the regulators/FDIC are still pounding them for their bad real estate and working capital loans.”

The banks are nervous about the fact that participating lenders will be required to issue funds without receiving any of the loans’ principle for a full year. In addition, the SBA is offering a lower interest rate than other loan programs.

The Coleman Report, a newsletter for banks, states that “the ARC loan program is already being positioned to be a failure, and lenders are going to be the key players behind that failure.”

Even the SBA says it expects ARC loans to default at a higher rate than its other programs. Banks will have to absorb the administrative costs of pursuing delinquent loans and liquidating those that default. On the other hand, some banks want to do all they can to inject cash back into the business community, but claim they haven’t had time to effectively research the program.

“We don’t know if we are going to be able to participate in the ARC loan program,” says Jeff Spinelli, SBA loan specialist at Farmers & Merchants Bank. “But we feel an obligation to help our clients in need. We are seriously evaluating it to determine precisely how we could make it available to our customers.”

Sarah E. Toffoli, vice president for Wells Fargo Bank, says, “As the No. 1 SBA lender for five years running, we will be participating in the ARC loan program and are seeking to help as many small business owners as possible.”

Hayley Matz, SBA press secretary, says, “We have been in communication with lenders since we announced the program, and have been responding to their questions and providing them with initial information since the May 18 announcement. The formal guidance, of course, came out on Monday and since then we have been doing training with lenders all across the country, as well as responding to their individual questions. The program will take a bit to ramp up, and that’s expected, but we’ve also heard that many lenders are ready to begin participating.”

As America’s small businesses continue to “take on water,” the jury is still out on whether the ARC loan program will be a lifeline to thousands of small businesses.

As seen on Colemanpublishing.com

admin — Wed, 24 Jun 2009 20:18:00 +0000

Thanks to Coleman Publishing for featuring our blog on their nationally known website!

ARC LENDERS
Wachovia
Wells Fargo & Co.
J.P. Morgan Chase & Co.
PNC Financial Services Group Inc.
Regions Bank
Suntrust
BB&T

Courtesy: University of North Florida SBDC

Known Participating Banks in the SBA ARC Loan Program
University of North Florida (SBDC) released a list of 8 lenders making SBA ARC loans. Some big lenders including Bank of America Corp., KeyCorp’s Key Bank unit and Toronto-Dominion Bank, or TD Bank Financial Group, are still on the fence about participating, citing concerns about heavy paperwork and strict rules on applicant eligibility.

The SBA plans to release a partial lender list of ARC loan participants by Monday

admin — Sat, 20 Jun 2009 13:07:00 +0000

Known participating banks in the SBA ARC loan program as of June 20th:

Wachovia

Wells Fargo & Co.

J.P. Morgan Chase & Co.

PNC Financial Services Group Inc.

Banco Popular North America

Regions Bank

Suntrust

BB&T

Here is a Wall Street Journal article written by Raymund Flandez that adresses the current Arc lending situation.

SBA Offers Aid to Cash-Strapped

The Rub: Some Big Banks See the Reward as Too Small for the Paperwork

The emergency loan program launched in the past week by the Small Business Administration is designed to give established businesses some breathing room to pay principal and interest payments on existing debt.

Borrowers, however, may find it difficult to find a bank that is providing the “America’s Recovery Capital” interest-free loans.

Some big lenders including Bank of America Corp., KeyCorp’s Key Bank unit and Toronto-Dominion Bank, or TD Bank Financial Group, are still on the fence about participating, citing concerns about heavy paperwork and strict rules on applicant eligibility.

“The general consensus is that the lenders aren’t too excited about it,” says Bob Coleman, publisher of “The Coleman Report,” a La Canada, Calif.-based trade publication for SBA lenders. “It’s a tremendous amount of paperwork.”

The ARC program offers as much as $35,000 for small businesses that have been profitable in the past but are having problems now because of the recession. Borrowers don’t have to begin repaying for at least a year, and have five years total to pay back the amount.

For lenders willing to provide the loans, the SBA is paying the interest on borrowers’ behalf, plus guaranteeing 100% of the loans in case of defaults.

Low Reward

Lenders, however, must decide if the administrative burden is worth it. Some say the upside is too small, as the interest rate—set at prime plus two percentage points, or currently 5.25%—is low and they won’t get principal back for at least one year.

But other top lenders of SBA-backed loans say they are eager to get involved. Wells Fargo & Co., J.P. Morgan Chase & Co., PNC Financial Services Group Inc. and Popular Inc.’s Banco Popular North America unit are participating.

“It may open up additional customers for the bank,” says Tom Burke, senior vice president of Wells Fargo SBA Lending, who received 22 calls himself the first day ARC loans were offered.

The SBA plans to release a partial lender list of ARC loan participants by Monday.

Banks that are hesitating, including units of U.S. Bancorp, CIT Group Inc., HSBC Holdings PLC and Live Oak Banking Co., a Wilmington, N.C., bank targeting veterinarian practices, still are reviewing the SBA’s guidance on the program or are determining their own guidelines.

“It’s frankly a lot of work for a $35,000 loan,” says Chris Reilly, president of CIT Small Business Lending Corp. “In concept, it’s a good program. I think, in practice, it has some challenges in terms of expeditiously getting borrowers through the application process.”

Under the program’s rules, lenders must obtain proof of financial hardship from borrowers, including documents that show a 20% decline in sales or a 20% decline in credit lines in the past year, and quarterly cash-flow projections that demonstrate the borrowers’ ability to repay.

Lenders also need to verify that ARC loans are used to pay down business debt, including credit-card debt, which could mean parsing borrowers’ records to separate business and personal expenses.

The SBA says ARC loans require roughly the same amount of paperwork for banks as its flagship 7(a) loans, which are capped at $2 million.

“Some lenders have commented that this level of documentation is high for such a loan,” says Michael Stamler, an SBA spokesman.

But if an ARC loan helps a business owner pay off a larger underlying loan, “then the investment evens out,” Mr. Stamler says.

At least one lender, TD Banknorth, has decided against participating, but will continue to offer other SBA-related financing vehicles.

‘Upsetting’ News

That is unwelcome news to customer Abhay Wadhwa, founder of AWA Architectural Lighting Design of New York, who has seen sales slip as much as 25% in the first two quarters of the year.

“That’s upsetting,” he says. “We have an account in good standing.” Mr. Wadhwa, 39 years old, now has an appointment with HSBC, where he also has an account, to try to secure an ARC loan.

ARC loans are available until Sept. 30, 2010, or until funding runs out. The SBA, authorized to spend $255 million, has set a maximum of 1,000 loans per lender.

Even if some lenders don’t participate, demand from struggling entrepreneurs is likely to surpass supply, says Tony Wilkinson, president of National Association of Government Guaranteed Lenders, a lobby group, in Stillwater, Okla.

http://unfsbdc.blogspot.com/2009/06/sba-small-business-loans-arc-loan.html

http://unfsbdc.blogspot.com/2009/06/sba-arc-loansmore-details.html

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