SBA Loan Programs You Might Not Know About

Most small business owners are familiar with Small Business Administration (SBA) loans.  SBA loans are underwritten and funded by traditional banks but backed by the federal government.  SBA loans are especially helpful to startups or new business owners as the terms and rates are generally more competitive than traditional loans, and the SBA provides quite a bit of help to borrowers beyond just the monetary assistance.
The SBA loan programs that most are familiar with are the 7(a) and 504 loan programs.  But the SBA also pilots new loan programs from time-to-time in order to expand their reach to small businesses that may not otherwise qualify for lending assistance.  One current program is the Community Advantage (CA) pilot program, part of the 7(a) loan program.

Community Advantage Pilot Program

The CA pilot loan program is designed for businesses having a difficult time qualifying for traditional financing or running into obstacles with traditional banks or online lending platforms.  The program also helps build your small business through assistance with market research, accounting assistance, payroll, and other types of support and education.
To qualify for this program, the business must be a for-profit company and operating in an underserved market as defined by the SBA.  As with all SBA loans, the application process is detailed with regards to the required information and documentation on both the business and its owner(s).  Collateral and a strong balance sheet, while important, are less critical than a good credit history and business viability as evidenced in a quality business plan.
Although still labeled a pilot, the CA loan program has been around since 2011. Originally scheduled to conclude on September 30, 2022, this pilot program has been so successful that it has not only been extended until September 30, 2024 but the maximum loan amount has been increased from $250,000 to $350,000.
The SBA’s loan programs can offer much-needed assistance in challenging times.  So consider whether an SBA loan is right for your business, and be sure to query the SBA’s website frequently for new pilot programs that could benefit your small business.

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