By Beth Kwon
Getting rejected by a string of unsympathetic loan officers is almost a rite of passage for cash-hungry entrepreneurs. That doesn't make it any less frustrating. But recent changes at the Small Business Administration should make it easier to win a loan guaranteed by the federal agency.
As of July 9, the SBA's newly beefed-up SBAExpress loan program has raised the maximum loan amount from $150,000 to $250,000. It has also opened the program up to as many as 2,400 lenders around the country, expanding on its previous roster of 180. The lenders must meet the SBA's criteria, but these have become less stringent than in the past.
Why the sudden influx of cash? Surprisingly, it's not related to Sept. 11 "The time was right to make these changes," says Ron Bew, associate deputy administrator for capital access, who says banks started rolling out loans in late summer. Anything to avoid more maxed-out credit cards sounds good to us.
Small businesses that have watched their business prospects dry up because of drought may soon find some help. The Senate Committee on Small Business and Entrepreneurship is currently urging approval of the Small Business Drought Relief Act, which would make small businesses eligible for disaster relief. "Fish and tackle shops, rafting businesses, restaurants and motels, marinas and gas stations; they're all hurting," says Senator John Kerry, committee chairman. So far, 37 states have requested disaster status from the U. S. Department of Agriculture because of local drought conditions. While it's too early to measure the full impact of the devastation, it could be huge. "Potentially half the small businesses in the United States could be eligible for relief," says a committee spokesman.
With health insurance costs skyrocketing, the House Small Business Committee in Congress will push the Senate to support Association Health Plan legislation this fall. AHPs would let groups of small businesses purchase employee benefits packages together, driving down premiums while increasing healthcare options. "Small businesses don't enjoy the same economies of scale that corporations do," says Committee spokesman Rich Carter. AHPs are especially crucial for women-owned businesses which tend to hire women and minorities -- groups for whom adequate healthcare is sometimes scarce, says Terry Neese, president of Women Impacting Public Policy. "In order for us to retain employees or hire good talent, we have to be able to compete with big business and offer a good benefit package," says Neese, who was able to bend President Bush's ear about AHPs during the Economic Forum in August. But the insurance lobby, which opposes AHPs, has been aggressively working the Senate. "The president has been supportive of AHPs," says Neese. "The hold-up has been the Senate."
Getting rejected by a string of unsympathetic loan officers is almost a rite of passage for cash-hungry entrepreneurs. That doesn't make it any less frustrating. But recent changes at the Small Business Administration should make it easier to win a loan guaranteed by the federal agency.
As of July 9, the SBA's newly beefed-up SBAExpress loan program has raised the maximum loan amount from $150,000 to $250,000. It has also opened the program up to as many as 2,400 lenders around the country, expanding on its previous roster of 180. The lenders must meet the SBA's criteria, but these have become less stringent than in the past.
Why the sudden influx of cash? Surprisingly, it's not related to Sept. 11 "The time was right to make these changes," says Ron Bew, associate deputy administrator for capital access, who says banks started rolling out loans in late summer. Anything to avoid more maxed-out credit cards sounds good to us.
Small businesses that have watched their business prospects dry up because of drought may soon find some help. The Senate Committee on Small Business and Entrepreneurship is currently urging approval of the Small Business Drought Relief Act, which would make small businesses eligible for disaster relief. "Fish and tackle shops, rafting businesses, restaurants and motels, marinas and gas stations; they're all hurting," says Senator John Kerry, committee chairman. So far, 37 states have requested disaster status from the U. S. Department of Agriculture because of local drought conditions. While it's too early to measure the full impact of the devastation, it could be huge. "Potentially half the small businesses in the United States could be eligible for relief," says a committee spokesman.
With health insurance costs skyrocketing, the House Small Business Committee in Congress will push the Senate to support Association Health Plan legislation this fall. AHPs would let groups of small businesses purchase employee benefits packages together, driving down premiums while increasing healthcare options. "Small businesses don't enjoy the same economies of scale that corporations do," says Committee spokesman Rich Carter. AHPs are especially crucial for women-owned businesses which tend to hire women and minorities -- groups for whom adequate healthcare is sometimes scarce, says Terry Neese, president of Women Impacting Public Policy. "In order for us to retain employees or hire good talent, we have to be able to compete with big business and offer a good benefit package," says Neese, who was able to bend President Bush's ear about AHPs during the Economic Forum in August. But the insurance lobby, which opposes AHPs, has been aggressively working the Senate. "The president has been supportive of AHPs," says Neese. "The hold-up has been the Senate."
