Small Business from Government

A small business owner should always give some serious consideration to the Government when seeking financing. If you can get it, government financing is a great way to go.

The Small Business Administration (SBA) has been charged by the United States Congress with the task of seeing to the financial needs of the nation's small business community. They accomplish this by offering a number of programs that guarantee loans to small business owners. A government loan for small business is actually made by a bank or other lending institution, but the SBA backs the loan. This is an important distinction and deserves some explanation.

Many people misunderstand the role of the Small Business Administration. They expect that their business loan will come directly from a government agency and the repayments will be made to the same place. This is not how it works. The loan must be made by a bank or lending institution and the repayments are made to the lender directly. The role of the government is simply to guarantee the loan. If the borrower defaults on the loan, the government will repay it to the lender. This greatly reduces the risk to the lending institution. The government is assuming all the risk and it is the government that will have to attempt to recover the funds in cases of default.

Yet, it is easy to see how this program would enhance your odds of loan approval from the lending institution. The government is actually the one that is going to do the credit checking here and the government pays close attention to credit worthiness and past credit history. It also should be realized that the government has a "public interest" reason in offering its loan programs. This public interest may take many forms such as encouragement of certain types of business or women and minority ownership.

Government loans for small business also may come from State governments. Many States offer loan protection guarantees on the same model as the SBA to encourage small business in their States. Again, these loans guarantee programs often are designed for a specific purpose that the State government deems to be in the public interest.

The fact that the government, State or Federal, has an agenda in its small business loan policy should not be a deterrent to the small businessman seeking financial aid especially for a business start up. The government guaranteed loan programs have helped thousands of people begin businesses and you could benefit from them as well. It is really the idea that the Government recognizes that small business is vital to the economic health of the country that led to the formation of the Small Business Administration in the first place.

 

When you are in business for yourself, you need to realize that you have to take full advantage of EVERYTHING that is available to you. I understand that locating money for your business needs is not as easy as ordering a grant book from a guy on television with question marks all over his suit, but the truth is YOU CAN INDEED use the federal government to grow your small business.

The government backed loans that you want to look into is the Small Business Administrations (SBA) GAAP loan used for business expansion. Now, you may be thinking that obtaining Federal Government small business loans through the SBA would be terribly difficult, but what if I were to tell you that 99.9% of EVERYONE that applies gets the loan immediately? Truly amazing isn't it. For many years, the Federal Government small business loans have been granted to the general public, it's simply a matter of locating the one that is best for you.

Getting back to the GAAP line/loan, there is not a better or easier way for you to fund your business. Here are a few of the points why it is such a good thing to go after.

1. It is an unsecured line, which means that there are no assets or collateral needed to obtain the loan.

2. It is quick. The approved funds can be in your account in 10 business days.

3. Extremely low interest rates , because they are government backed.

4. Almost everyone is approved.

The trick to obtaining these loans is to find them. We have made our business out of jus locating these sources and you would be surprised at just how many government backed programs are available. All are nationwide and you simply have to know the right person to contact and let them know what you need.

So to wrap things up….Can you locate and use the Federal Government to fund your small business in the form of a loan? Yes indeed you can.