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Article details provided by Valerie Bumb, VP, Commercial Loan Officer
 Government-enhanced loan programs like SBA and USDA loans can be vital for your business.
The SBA offers support on loans to finance general business needs including real estate for operating entities. The USDA focuses on agricultural and rural development. Those loans are supported at federal and state levels, with joint efforts to provide additional assistance through grants and other programs.
Differences from Traditional Loans
Unlike traditional loans, these specialty loans are supported by government guarantees. That means while lenders like Croghan still underwrite the loans, the government's support allows us to offer financing to businesses that might not meet conventional standards.
“These lending options are ideal when a business owner has a good plan and the ability to repay the debt, but have limited resources,” said VP, Commercial Loan Officer, Valerie Bumb.
Benefits and Drawbacks
Government-enhanced loans offer longer repayment terms and fixed rates, which you may not find with traditional loans. These loans are particularly beneficial if you want to finance a major purchase like equipment or real estate.
Applying for a Government-Backed Loan
Applying for this type of business loan can be more intensive and time-consuming. You will need to provide documentation, including the last three years of your personal and business financial histories, a business plan and financial projections. That information helps lenders understand your business's story and future potential as a borrower.
Current Trends and Future Demand
SBA lending is experiencing high activity due to reduced costs and fees. As economic conditions evolve, demand for these loans is expected to grow, with government programs likely continuing to play a key role in supporting small businesses.
“The government has a great interest in keeping our economy strong,” Valerie said. “These programs are a result of the federal government encouraging banks to continue lending to, and supporting the small business owners.”
Are you considering an SBA or USDA loan? Email Valerie for information, and she’ll help you get the loan process started.
*All loans are subject to credit approval. |
