Small Biz and the Stimulus

Part of the economic recovery bill, to be signed into a law by President Obama, will focus on increasing the number of small business loans that banks issue. A number of other measures in the recovery bill are also aimed directly at improving the small business environment.

CNN Money reports:
"The bill authorizes the Small Business Administration to temporarily eliminate or reduce fees for participation in its flagship loan-guarantee programs, which insure banks against default by small business borrowers. The stimulus bill also increases to 90% the percentage of qualifying loans that the SBA can guarantee. For companies in need of quick relief, the bill offers a 'small business stabilization financing,' which gives them money to pay off existing loans. Under the program, the SBA can issue or back loans of up to $35,000; businesses can then use the money to make up to six months of payments on previous loans. Interest on stabilization loans will be fully subsidized, and the loans won't have any payments due for the first year. Borrowers must repay them within five years."

The bill will also introduce hiring incentives, encourage purchases of new equipment, and secure a break on capital-gains taxes for people who invest in small businesses over the next few years.

UPDATE: is now online.


This is a very good

This is a very good initiative, however, there should be some consideration for start up ventures and businesses under 2 years old. My company is only 18 months old, my cash flow has been good but my sales have dropped, so I am using all my cash flow for the past two months to pay expenses, its is dwindling. I cannot get a loan because every institution who could help says the business MUST BE 2 YEARS OLD. My business does not have enough credit history to get any more credit, the one credit card I have my credit was suddenly cut, so I am stuck. I personally do not have enough credit history to get personal credit. I have been using my husband credit. This in not good for developing my business credit as everything is under his personal name. His credit is very good, however I need to build the business credit. NO one will give the business any credit because of lack of history, so how will I develop a credit history if no one will give credit? How could the stimulus package help my situation. I am sure many small businesses share my diima. We need a bail out.

I am in the same boat as you!

I am in the same boat as you! Wells Fargo told me I had to be in business 3 years and my credit had to be 650 or higher. I have a friend tellingme that the government gives grants - money that doesn't have to be repaid!

his is a very good

his is a very good initiative, however, there should be some consideration for start up ventures

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