DETROIT ? Enhancements to the U.S. Small Business Administration loan programs, made available under the American Recovery and Reinvestment Act, continue to be a key factor in the rebound of SBA-backed loans for small businesses. SBA Michigan District Office statistics for the first six months of this fiscal year show a tremendous increase in both dollar amounts and the number of loans compared to last year at this time.
Through March 31, SBA guaranteed 726 7(a) loans in Michigan for $234,307,000 compared to 391 loans for $76,571,471 one year ago when the credit crunch was in full force. This is an 86% increase in the number of loans and a 206% increase in dollars.
?Small businesses across Michigan have been able to secure critical financing as a result of the Recovery Act loan provisions and the continued interim funding we?ve received for the program,? said Michigan District Director Richard Temkin. ?These programs have been successful in helping to deal with the problems many small businesses have had in getting access to capital.?
The provisions of the Recovery Act that had the greatest impact in boosting loan activity were the temporary increase in the amount that SBA can guarantee to 90% and the temporary elimination of fees to the borrower. In fiscal 2009, 111 lenders, a 25-year high, had a loan approved through the SBA 7(a) loan guaranty program in Michigan. In the first six months of fiscal 2010, 85 lenders have already made a loan using this program.
?SBA has the tools and training to help lenders use our loan guaranty programs. We encourage them to explore all options for financing small businesses,? said Temkin.
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