More Entrepreneurs Looking for Gov’t Loans
(Wall Street Journal) — Amid tougher lending standards and riskier times, a growing number of small-business borrowers are seeking federal government loan guarantees to loosen the purse strings at their local bank, according to SmartMoney’s latest Take Two profile of 50-plus entrepreneurs. With several weeks left in the fiscal year, the Small Business Administration’s two main lending programs have already surpassed arecord-high $18 billion in guaranteed loans issued through banks and other conventional lenders, agency data show. That’s more than double the full-year total in 2009. Depending on size, SBA loans are guaranteed for up to 85% against default. Like many borrowers, Alan Green, a former television news photographer who is the subject of this week’s profile, was initially turned down by three banks for a loan he needed to buy an ailing Molly Maid franchise in Salt Lake City. Yet after applying for an SBA 7(a) loan, Green, 59, had a check for more than $100,000 within a matter of weeks.