SBA will temporarily eliminate the upfront guaranty fees on 7(a) loans approved by SBA on or after February 17, 2009. Prior to this change to the 7(a) program (one of SBA’s most popular programs), guaranty fees ranged from 2% – 3.75% of the guaranteed portion of the loan. For perspective, the guaranty fee on a $200,000 loan was $4,500, and $11,250 on a $500,000 loan.
For eligible loans approved through SBA’s 504 program on or after February 17, 2009, SBA will temporarily eliminate Third-Party Participation Fees and CDC Processing Fees (typically 1.5% of the loan amount). The 504 program is often used to purchase commercial real estate of which the borrower’s business must occupy at least 51%.
Depending on loan volume, SBA estimates that it will be able to eliminate these fees through December 31, 2009.
Call Lisa Mumford, Commercial Lender at Founders Community Bank, at 543-6500 for more information.
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Great information! This is good news for many of our clients and potential clients!
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