Nothing good in life comes easy, and that includes getting financing for your small business.
"Despite advertisements to the contrary," SCORE counselor and former local bank president Paul Olander explains that "no federal government agency — including the Small Business Administration — offers grants to start or expand small businesses. Most foundations, corporations and private institutions that sponsor grant programs follow the same policy, except in cases where the business involves development of a new technology, or is a nonprofit organization."
Olander said the SBA does administer several loan programs in partnership with local lenders, community development organizations, and micro-lending institutions (agencies that specialize in limited, short-term financing). SBA backs those loans with a guaranty against non-payment for a portion of the loan. This eliminates some of the lender’s risk.
SBA loan programs include the basic 7(a) program; "504" loans, which are delivered through Certified Development Companies for acquiring real estate, machinery, or equipment as part of an expansion or modernization; the 7(m) micro-loans of up to $35,000; and the post-disaster recovery and assistance loans.
Depending on where you live, your small business may be eligible for assistance from state and local economic development agencies. Established small businesses can apply for federal grants to carry out various publicly mandated services or programs. As with the SBA loan program, they must be operated for profit, have a place of business in the U.S., significantly contribute to the economy, and meet size standards for its industry.
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For assistance with creating a financing strategy for your new or growing small business, you’ll find a wealth of experience and insights at SCORE.
This complete article is at www.score-rochester.org/pb_articles.html
Dean L. Swanson is a volunteer SCORE Counselor.
Go to www.Postbulletin.com/weblinks for more information on this topic and links to access free, confidential business counseling and training workshops provided for small business owners.
Free counseling and workshops and more details on this topic: http://www.score-rochester.org
SBA Loans: http://www.sba.gov
Federal Grants: http://www.grants.gov
Foundations Directory of grants: http://www.fconline.fdncenter.org
