SBA 7 (a) Loan
SBA 7 (a) loan program is set up to help specific businesses get financial help. For example, it comprises several other subsidiary programs, such as Export Loan Program, Rural Business Loan Program, etc. The idea is to help businesses with special requirements with their financing needs. Funds are only available in this program for very specific purposes. The goal of this loan program is to spark economic growth by committing more capital to small businesses and entrepreneurs in underserved communities.
Here is a look at the various SBA 7 (a) loan programs:
Special Purpose Loans Program- These loans are for businesses impacted by NAFTA (North American Free Trade Agreement). There are four specific loan programs that are part of this SBA 7 (a) loan program: CAPLines, CAIP, Pollution Control, Employee Trusts. The funds are used to provide assistance to employee stock ownership plans, and help get pollution control mechanisms in place.
Express & Pilot Programs- These are loans that involve shorter applications and express responses to applications, as little as 36 hours. They were designed for particular borrowers such as military personnel, borrowers in distressed communities, veterans, etc.
Export Loan Programs– These are set up to encourage small businesses to develop or expand their exporting activities in order to provide more jobs. There are four options for financing that can be used to get money faster, have working capital, expand to international trade, etc.
Rural Business Loans- These SBA 7 (a) loans were designed to help small rural based communities grow more rapidly by streamlining the application process, and simplifying it, as well as eliminating fees that made it too expensive for some small businesses to consider.
SBA 7(a) loan proceeds can be used to help buy an existing business, start a new business, or expand an existing business.