Posted on 01/17/2019 5:58:45 AM PST by reaganaut1
The longest government shutdown in modern U.S. history is choking the economic lifeblood of many entrepreneurs.
The Small Business Administration has stopped approving routine small-business loans that the agency backs to ensure entrepreneurs have access to funds, halting their plans for expansion and repairs and forcing some owners to consider costlier sources of cash.
Honey Meadows, owner of the Westside School, a child-care center in Atlanta, plans to use a $405,000 loan guaranteed by the SBA to make needed improvements and refinance roughly $275,000 in existing debt. With SBA approvals at a standstill, Ms. Meadows cant build a wheelchair ramp, buy a van to transport children or add classrooms and teachers.
Its scary to think we have these plans, and they may be put on hold, said Ms. Meadows, who currently cares for 38 children. The new loan she is seeking from the SBA will carry an interest rate of about 8.25% and a 25-year term, according to Immito, Ms. Meadowss lender.
SBA loans are a mainstay for many entrepreneurs, who generally can borrow as much as $5 million to start, buy, expand or run a small business through the agencys two biggest programs. While the SBA doesnt directly fund small-business owners, it covers as much as 90% of loan losses, giving an incentive to banks and other financial institutions to finance businesses they might not otherwise serve.
Lenders say they are still taking loan applications and closing loans that have already received SBA approval. But it isnt clear when borrowers like Ms. Meadows will get financing.
About half the loans going through due diligence now arent going to be able to close before the government opens up, said John Moshier, president of small business lending at Ready Capital Corp. , a licensed nonbank SBA lender in New Providence, N.J.
(Excerpt) Read more at wsj.com ...
"While the SBA doesnt directly fund small-business owners, it covers as much as 90% of loan losses, giving an incentive to banks and other financial institutions to finance businesses they might not otherwise serve."
Obviously banks will make bad loans when they avoid 90% of the losses from them.
Exposing the fact that capitalism in this country is largely a sham. The so-called capitalists are as dependent on the government teat as any welfare mom in the Bronx.
Bull crap...banks, STEP UP!
Yep. Let it stay shut down after President Trump breaks the will of the Resistance.
I don’t need a specifically woman owned or minority owned business.
Sink or swim, I don’t give a crap about these businesses.
SBA loans preferentially go to women/minority owned businesses, so this disproportionately affects Democrats.
Yep. Not the government’s business.
Yep. At the end of the day, most people who are directly hurt by this are the enemies of Trump anyway. When you try to appease the enemy, you’re doing it wrong.
In this case women and minorities ARE hardest hit, as they’re the only ones who qualify for SBA loans.
It can stay shut down.
Huge fraud
Last I knew it was virtually impossible to get a loan from the SBA if it was a straight white male signing the application. Therefore “women and minorities hurt most” applies here, but only because whitey has been sidelined anyway.
But black, brown, and female of all colors have the red carpet out for them.
Still, can’t they try peer to peer lending?
No legitimate small business owner should be seeking loan guarantees from the government. But a lot of pseudo-business scammers with connections to the Democrat party do. Another win for Trump.
This is an interesting point of view. Some will like it and some will hate me but I do believe in freedom of speech and exchange of ideas.
https://www.youtube.com/watch?v=3MLj6Lv3g0U&feature=youtu.be
Not a week goes by that I don't get at least a half dozen offers from banks offering microloans, big loans, credit cards and the like.
A lot of banks (especially your brick and mortar drive-bys) are in the habit of making only zero risk loans as an ObaMao legacy. Look elsewhere.
SBA was initially chartered to make those kind of loans. They've become another boondoggle to hand out political favors. Those offers you get in the mail are dismissed as a lot of junk. Most are, some aren't.
Get to know a retied businessman or even a business owner and they will steer you to what is legit and what is not . . . they may even introduce you to a brick and mortar banker or credit union willing to make something other than near no risk loans like real estate or automotive where the collateral to loan value ratio is large.
Permanently shut down this agency!
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