SBA Loans: Qualifying and Applying

In this first segment of this two-part article we will discuss some of general requirements and application procedures involved in acquiring an SBA loan.

According to federal government research, small businesses provide about 75% of net new jobs added to America's economy. They also employ fully one-half of America's private sector workforce. 99.7% of all employers in U.S. are small business owners. These statistics make a strong case for existence of a federal organization dedicated to promotion and proliferation of small businesses in this country.

In 1953 United States government established Small Business Administration (SBA) as a way of assisting entrepreneurs in forming successful small businesses through government guaranteed loans. While SBA does make many small-business loans itself, its primary function is to guarantee small-business loans made by private lenders.

Most SBA loans are secured through any one of SBA's many licensed partners nationwide. Besides establishing lending guidelines for their partners, SBA also ensures reasonable loan terms by guaranteeing major portions of loan in event of a borrower default. Because of decreased liability provided by SBA, lender is able to offer better interest rates and options to businesses in early stages of development.

Before we get too excited about potential benefits of SBA loans, it may be a good idea to first talk about who can potentially qualify. The size of your company obviously plays a large role in securing an SBA loan; after all, this is about 'small business'.

If you run a manufacturing company, its possible to have up to 1,500 employees working for you and still qualify for an SBA loan. On other hand, depending on type of manufacturing you do, it may be more likely that you'll be limited to 500 employees in order to qualify for loan consideration.

Investing in Dividend Paying Stocks

I was recently interviewed for a press release through a financial question and answer format. One of questions asked of me in interview was:

Where do you think stock market is headed over next five years?

My Answer!

Charles M. O’Melia: No one knows! There is an old Chinese proverb that goes something like this: “He, who could foresee events 3 days in advance, would be rich for thousands of years.” On a long-term basis I have only witnessed expansion and progress. I believe that to be nature of our American economy and our American way of life. And as our economy goes, so goes stock market and I see no reason to change that belief.

Who would have thought expansion in China would generate 5 billion dollars of business for GE? The US companies listed on New York stock exchange have ability to profit throughout global expansion of business around world. And, an investor can profit without necessity of having to own an overseas fund or companies to profit.

Up until that question, thought of what market was going to do tomorrow (or for that matter, 5 years from now) have never concerned me. I never gave it a thought (Well, maybe a little!). There just isn’t enough concern on my part whether we are heading for a bear market or a bull market, or if markets are heading sideways.