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Alternative Financing Options. David Lewis Brunswick SBDC. Small Business Administration Loan Programs. Primary SBA Business Loan Programs. 7(a) 504. 7(A) Loan Guaranty Program

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alternative financing options

Alternative Financing Options

David Lewis

Brunswick SBDC


7(A) Loan Guaranty Program

The 7(a) Loan Guaranty Program is the SBA’s primary lending programs. It provides loans to small businesses unable to secure financing at reasonable terms through normal lending channels. The program operates through private-sector lenders that provide loans that are, in turn, guaranteed by the SBA — the Agency has no funds for direct lending or grants.


Eligible Use of 7(a) Loan Proceeds Include (Non-Exclusive):

-The purchase land or buildings, to cover new construction as well as expansion or conversion of existing facilities

-The purchase of equipment, machinery, furniture, fixtures, supplies, or materials

-Long-term working capital, including the payment of accounts payable and/or the purchase of inventory

-Short-term working capital needs, including seasonal financing, contract performance, construction financing and export production

-Financing against existing inventory and receivable under special conditions

-The refinancing of existing business indebtedness that is not already structured with reasonable terms and conditions

-To purchase an existing business 

SBA loans cannot be used for these purposes:

-To refinance existing debt where the lender is in a position to sustain a loss and SBA would take over that loss through refinancing

-To effect a partial change of business ownership or a change that will not benefit the business

-To permit the reimbursement of funds owed to any owner, including any equity injection or injection of capital for the business's continuance until the loan supported by SBA is disbursed

-To repay delinquent state or federal withholding taxes or other funds that should be held in trust or escrow

-For a non-sound business purpose


7(a) Express Programs

SBA's Express programs offer streamlined and expedited loan procedures for particular groups of borrowers, notably active duty military personnel, veterans, and borrowers from distressed communities.


The SBAExpress program gives small business borrowers an accelerated turnaround time for SBA's review. You will receive a response to your application within 36 hours.

Community Express

The Community Express loan program allows approved SBA lenders to provide a unique combination of financial and technical assistance to borrowers located in the nation’s underserved communities. Eligible communities include the SBA’s Historically Underutilized Business Zones (HUBZones) and those communities identified as distressed through the Community Reinvestment Act (CRA). To encourage small businesses start-ups, the SBA makes eligible loans of $25,000 or less, regardless of where your small business is located. Sunsets April 30th 2011.

Patriot Express

The U.S. Small Business Administration has the SBA’s Patriot Express Pilot Loan Initiative for veterans and members of the military community wanting to establish or expand small businesses. The SBA and its resource partners are focusing additional efforts on counseling and training to augment this loan initiative, making it more accessible and easy to use.


Borrego Springs Bank

  • Borrego Springs Bank is committed to making small business lending a priority.
  • Their nationwide Preferred Lender Program (PLP) status, under the United States Small Business Administration (SBA), enables them to be responsive to your small business needs and their PLP designation means that loan decisions are made at their bank and your business benefits from a quick response and excellent customer service. They are committed to helping you with your SBA loan from the application stage through the final disbursement.

(866) 644-0042


Small Loan Advantage and Community Advantage 7(a) Loan Initiatives

  • SBA is committed to expanding access to capital for small businesses and entrepreneurs in underserved communities so that we can help drive economic growth and job creation. In line with that, SBA is rolling out two new initiatives on February 15, 2011, aimed at increasing the number of loans in these communities.
  • Small Loan Advantage
  • Small Loan Advantage is structured to encourage larger, existing SBA lenders to make lower-dollar loans, which often benefit businesses in underserved markets.
  • Maximum Loan Size: $250,000
  • Guarantee: 85 percent for loans up to $150,000 and 75 percent for those greater than $150,000.
  • Approval Times: Most Small Loan Advantage loans will be approved in a matter of minutes through electronic submission (e-Tran). Non-delegated Small Loan Advantage loans will be approved within 5 to 10 days.
  • Paperwork: Small Loan Advantage features streamlined paperwork, with a two-page application for borrowers and lenders can use their own note and guaranty agreement.
  • Lender Requirements: Small Loan Advantage is open to financial institutions (currently 630 lenders) participating in SBA’s Preferred Lender Program (PLP).
sba 504 cdc loan program
SBA 504 CDC Loan Program

The 504 loan program is a long-term financing tool, designed to encourage economic development within a community. The 504 Program accomplishes this by providing small businesses with long-term, fixed-rate financing to acquire major fixed assets for expansion or modernization. A Certified Development Company (CDC) is a private, nonprofit corporation which is set up to contribute to economic development within its community. CDCs work with SBA and private sector lenders to provide financing to small businesses, which accomplishes the goal of community economic development.


Eligible Uses of 504 Proceeds:

  • The purchase of land, including existing buildings
  • The purchase of improvements, including grading, street improvements, utilities, parking lots and landscaping
  • The construction of new facilities or modernizing, renovating or converting existing facilities
  • The purchase of long-term machinery and equipment
  • Refinancing in some situations.
  • The 504 Program cannot be used for working capital or inventory, consolidating or repaying debt.
  • Loans cannot be made to businesses engaged in speculation or investment in rental real estate.
the national association of development companies
The National Association of Development Companies

NADCOis the trade association of Certified Development Companies (CDCs) - companies that have been certified by the Small Business Administration (SBA) to provide financing for small businesses under the SBA 504 Program.

(703) 748-2575

microloan program
Microloan Program

The Microloan Program provides small, short-term loans to small business concerns. The SBA makes funds available to specially designated intermediary lenders, which are nonprofit community-based organizations with experience in lending as well as management and technical assistance. These intermediaries make loans to eligible borrowers. The maximum loan amount is $50,000, but the average microloan is about $13,000.

How Microloan Funds May Be Used

  • Microloans may be used for the following purposes:
    • Working capital
    • The purchase of inventory or supplies
    • The purchase of furniture or fixtures
    • The purchase of machinery or equipment.
    • Proceeds from a microloan cannot be used to pay existing debts or to purchase real estate.


Joining BoeFly is easy, and gives you immediate access to resources that can help you get a loan.


Depending on your plan, either use our tools to prepare your loan request, or have a BoeFly expert do it for you!

Review Matches

Your loan request is matched with several compatible lenders who will request access to your full loan package.


Compatible lenders will be in contact to review your request and complete the loan process.

BoeFlyhas brought together a team of business and technological experts to revolutionize the way deals gets done, placing at its members’ fingertips, on a single secure website, all the tools and resources they need to match the customized credit criteria of banks with loan submissions, and link banks with investors interested in purchasing troubled loans.



Peer-to-Peer Lending Means Everyone Prospers

Prosper is the market leader in peer-to-peer lending—a popular alternative to traditional loans and investing options. They cut out the middleman to connect people who need money with those who have money to everyone prospers!

  • Here’s how it works:
  • Borrowers choose a loan amount, purpose and post a loan listing.
  • Investors review loan listings and invest in listings that meet their criteria.
  • Once the process is complete, borrowers make fixed monthly payments and investors receive a portion of those payments directly to their Prosper account.



Today the database has grown to over 4,000 sources of business capital and you can simply enter what you need and up they come. But they don't waste your time, so if you indicate you have a fico score of 560 and they require a 680 you won't see them. The same is true for all their funding criteria, so you will only see those funding sources that your data matches.



What is Accounts Receivable Financing/Factoring?

  • A cash flow tool that allows you to use your accounts receivable as an asset to ensure the growth of your business, without diluting your existing equity or incurring additional debt.
  • An effective way to turn your accounts receivable into immediate cash which you can use any way you wish.
  • How is this beneficial to my business?
  • The funds can be used for almost any business expense such as increasing inventories, capital expenditures, taking advantage of supplier discounts, hiring additional staff, and expanding facilities.
  • Accounts receivable financing frees your staff from onerous billing, collection, and administration chores while eliminating costly mailing fees. CFG can take over the backroom operations for your credit and collections departments.
  • Who needs factoring?
  • Undercapitalized or new companies
  • Growth oriented companies
  • Companies that cannot get adequate bank financing
  • Companies with tax problems, liens, or working through a bankruptcy
  • Companies with low or negative net worth