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The U.S Small Business Administration (SBA) is looking to serve small business owners as they look for ways to access capital.

Earlier this year, the SBA implemented a new measure to help get small business loans into the hands of veterans.  To continue supporting America’s veterans, the SBA Veterans Advantage reduces the up-front guaranty fee from 3% to 0% for SBA Express loans over $150,000 approved to small businesses owned by qualified veterans.

The SBA has implemented this measure in order to encourage greater participation in SBA lending programs with a direct benefit to veteran-owned small businesses.

This measure set the borrower upfront fee to zero for all veteran loans authorized under the SBA Express program (up to $350,000) which accounts for 73 percent of these loans.  The initiative started on January 1st, and will continue through the end of the fiscal year.

This change makes loans more affordable for borrowers.

Again, this policy announcement means that under the SBA Express program, veteran borrowers will no longer have to pay any upfront fee for any loan up to $350,000.

SBA provides veterans access to business counseling and training, capital and business development opportunities through government contracts. In FY 2013, SBA supported $1.86 billion in loans for 3,094 veteran-owned small businesses.   And since 2009, the dollar amount of SBA lending support to veteran-owned firms has nearly doubled.

Businesses must be 51% or more owned and controlled by an individual or individuals in one or more of the following groups: Veterans (other than dishonorably discharged); Service-Disabled Veterans; Active Duty Military service member participating in the military’s Transition  Assistance Program (TAP); Reservists and National Guard Members; or the Current spouse of any Veteran, Active Duty service member, or any Reservist or National Guard member; or widowed spouse of a service member who died while in service or of a service-connected disability.

 

President Signs Vet Entrepreneurship Act

By Debbie Gregory.

President Obama recently signed an act that will encourage and equip veterans who want to start their own small businesses. To help navigate financial barriers, the new law waives the upfront guarantee fee for veterans applying for 7(a) express loans through the Small Business Administration (SBA), thus helping recently discharged service members and other veterans with opportunities to start new businesses.

With 21 million veterans living in the United States, the unemployment rate among this population is substantially higher than the national average. Because of this challenging statistic, more veterans are exploring self-employment opportunities.

The bill, introduced by House Small Business Committee Chairman Steve Chabot (R-OH), has received praise from lenders and veterans alike.

“Our veterans are as entrepreneurial minded as anyone else in the world,” said Chabot. “Think about all that’s required to launch a new business:  strategic planning, tactical expertise, dogged perseverance, and the ability to adjust plans to overcome new challenges at a moment’s notice. This is the American warfighter. Making sure they can access the resources needed to start their own business and build up the communities they’ve protected will do more than just create jobs – it will help them successfully transition into civilian life.”

Rich Bradshaw, President of Specialized Lending at United Community Bank, Blairsville, GA said, “As a lender, a veteran, and an Air Force Academy graduate, helping veterans make a life for themselves and their families once they return home from service is very personal to me. With more veterans returning to American soil, it is essential we do everything we can to bring down barriers to obtaining access to capital as they come back from doing everything they can to protect our country.  Waiving fees for veteran 7(a) borrowers encourages them to open small businesses, create jobs, and boost the economy.”

According to the Small Business Administration, an estimated 10% of all small businesses across the US are veteran-owned.

SBA Arizona District Office

Date: September 17, 2015

Time: 9:00 am to 11:00 am. Please arrive promptly.

Location: SBA Training Center on 2828 N. Central Avenue, Suite 800, Phoenix, AZ 85004. Phone (602) 745-7200. We are located at the Southwest corner of Thomas and Central.

Why You Should Attend:

Learn about Veteran Services and Programs available from the U. S. Small Business Administration

  • Starting your business – Business Development Plan
  • Financing Your Business – Vet Advantage & Military Reservist Economic Injury Loans
  • SBA Loan Clinics – Special two hour training classes held the first Wednesday of every month to explain the SBA loan process, eligibility and which lenders are making loans
  • Growing Your Business – Funding for expansion
  • Contracting Opportunities – Service Disabled & Veteran Owned Businesses
  • Counseling – Veteran Business Development Officer, SCORE, SBDC and Women’s Business Centers

These seminars will provide a unique insight for both aspiring veteran entrepreneurs and those already in business!

Non-validated parking is available in the building garage or limited free parking on the side street. There is no charge to attend this event other than parking expense, cash only for the garage.

vamboa grant

By Debbie Gregory.

As military members complete their tours of duty, re-establishing their careers may be one of the most important tasks in returning to civilian life. Some may be returning to careers that were interrupted during the time they served, but many are starting from scratch. Though the job market is showing some signs of improvement, it’s a slow rise, and those returning veterans are only adding to the many already vying for available jobs. This is one reason many veterans are coming home with aspirations of starting their own businesses.

Entrepreneurial endeavors may be the desired direction, but a good number of veterans express the difficulty acquiring their startup funds to be their biggest challenge. While most industry sectors have veteran business-owners, be it manufacturing, consulting or service industries, technology-related businesses appear to be increasingly popular for veteran entrepreneurs.

Banks are not as willing to establish loans for startup businesses. This leaves potential business owners needing to resort to other means to get their enterprises underway, be it self-funding, crowd-funding, or acquiring funds from friends, relatives, angel investors and venture capitalists. When those resources do not prove to be sufficient, an alternative is exploring government grants specifically for veterans in technology.

There are some stipulations. For example, while the federal government cannot provide grants to a business in the startup phase, it can provide grants for veteran-owned technology firms once established. Two in particular, the Small Business Innovation Research (SBIR) program and the Small Business Technology Transfer (STTR) program, average $2 billion in grants awarded each year. Administered by the U.S. Small Business Administration, the businesses most likely to be awarded grants from these programs fall into the small high-tech category, related to healthcare, education, public safety and criminal justice.

With numerous opportunities for gaining financial stability, and informational resources, such as those available through organizations like VAMBOA (Veteran and Military Business Owners’ Association), startups for veteran entrepreneurs are, indeed, attainable. Of the 28 million businesses in the U.S., approximately 2.4 million are veteran-owned, and this number is growing.

LINC tool

By Debbie Gregory.

This week, the U.S. Small Business Administration (SBA) announced that it will be launching an innovative tool on its website that will allow entrepreneurs looking for a small business loan to connect directly with an SBA lender.

The tool is called LINC, short for “Leveraging Information and Networks to access Capital.” By filling out a short online form, LINC connects entrepreneurs to lenders within 48 hours. The SBA hopes that through the utilization of LINC, the federal agency will be better able to provide guidance and ensure that more capital is reaching our nation’s small businesses.

“Effective today, LINC will bring entrepreneurs and SBA lenders together,” said SBA Administrator, Maria Contreras-Sweet.  She continued, “There’s a hunger among entrepreneurs to find financing to get their business off the ground or take the next big step in their expansion plan. The SBA stands there ready to help them, now with a few simple clicks.”

LINC users fill out a twenty-question online form, and their answers are sent to every lender in their county, as well as lenders with a regional or national reach. Once these lenders have reviewed the information, they respond directly to the entrepreneur within 48 hours. There are no fees and no commitment associated with LINC. It is a free federal initiative offered exclusively through the SBA

Contreras-Sweet went on to say, “Across the country, thousands of small business owners pound the pavement every day, looking for term loans, equipment financing, lines of credit, invoice financing, and real estate loans to help them hire and grow. If you have a bankable business idea backed by good credit and sound financial planning, the SBA wants to streamline the process for you to get the capital you need.”

It is the hope of the SBA that LINC will free entrepreneurs from feeling like their only lending option comes from one neighborhood bank. By using technology, LINC will help entrepreneurs get their foot in the door at multiple institutions, in one shot, and improve their access to the capital they need to start or maintain their small business.

Currently, there are 124 lenders across the nation participating in LINC. The SBA will look to expand into more traditional banking institutions that offer a more diverse menu of financial products.

For more information about LINC or to connect with SBA approved lenders, please visit https://www.sba.gov/tools/linc

The Veteran and Military Business Owners Association (VAMBOA) is a non-profit business trade association that promotes and assists Veteran Business Owners, Service Disabled Veteran Owned Businesses (SDVOB) and Military Business Owners. Small businesses are the backbone of our economy and responsible for job generation. That is why VAMBOA provides its members with Business Coaching, Contracting Opportunities, a Blog that provides information, Networking contacts and other resources. Membership is FREE to Veterans. Join Now!

VAMBOA: SBA Launches Program Connecting Entrepreneurs to Lenders: By Debbie Gregory

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