Small Business AdministrationThe Small Business Administration (SBA) offers financial assistance in the form of partial loan guaranties on small business loans made by banks and other commercial lenders. When a loan request does not meet regular lender approval requirements, SBA guaranteed financing can enable the lender to provide financing the would not otherwise be available on reasonable terms.
SBA Guaranteed 7(a) Loan
The SBA guaranteed loan is available to most start-ups and small businesses in most industries. The maximum loan amount is $2 million. The SBA guaranteed portion is limited to $1 million, or 75% or the loan, whichever is less. Loans up to $150,000 may be processed under an expedited procedure known as “LowDoc.” Under the primary 7(a) loan program, the SBA can guarantee 85% of a loan up to $150,000 and 75% on loans over $150,000. The proceeds of SBA 7(a) loans may be used for:
- Acquisition of furniture, fixtures, machinery, and equipment
- Construction, renovation, or leasehold improvements
- Purchase of inventory
- The purchase of real estate
- Working capital
SBA 504 ProgramThe SBA 504 program is available to businesses with less than $6 million net worth and an average income of less than $2 million over past two years. The program provides long-term fixed asset loans up to 20 years. Projects are financed by a first mortgage loan from a private lender (bank), and a second mortgage 504 loan made by a Certified Development Corporations (CDC) and funds provided by the small business concern.
Interest rates are based on current treasury issues, plus a small spread for administration. CDC loan portion cannot exceed 40% of a project. Maximum SBA debenture loans can be up to $1 million, must be used for fixed assets, and generally must create one job for every $35,000 of SBA funds. Start-ups must contribute 10-20% equity to total start-up.
The local CDC is the Ark-La-Tex Investment and Development Corporation, a subsidiary of the Coordinating and Development Corporation. Contact the Ark-La-Tex Investment and Development Corporation at 318-632-2022 with any questions.
SBA International Trade Loan ProgramThe SBA International Trade Loan Program is available to small businesses engaged in international trade or adversely impacted by competition from imports. The SBA can guarantee up to $1,250,000 for a combination of fixed-asset (facilities and equipment) financing and Export Working Capital Program (EWCP) assistance.
The fixed-asset portion of the loan guaranty cannot exceed $1,000,000, and the non-fixed asset portion cannot exceed $750,000. Funds must be used for export related activities, and may not be used to refinance existing debt. Maximum term is 25 years.
Contact your local banker or the Shreveport Export Assistance Center at 318-676-3064 with any questions.
SBA Export Working Capital ProgramThe SBA Export Working Capital Program is available to exporters who need short-term working capital to finance transaction-specific exports. The maximum guarantee is 90% of the loan; generally up to $750,000. Funds must be used for export related activities. The line of credit is generally available for 12 months. A personal guarantee required.
Contact your local banker or the Shreveport Export Assistance Center at 318-676-3064 to get started.
For SBA loans such as FastTrac and LowDoc, contact your local banker, or:
The Shreveport SBA District Office, LSUS
College of Business
Shreveport, LA 71115
Downtown Shreveport Development Corporation Loan ProgramThis financial incentive is designed to provide rehabilitation funds to property owners and small businesses interested in renovating older buildings located within Shreveport’s Downtown Development District. Loans are usually limited to a maximum of $30,000, with a fixed low interest rate as low as 3.5%.
Contact the Downtown Shreveport Development Corporation at 318-222-7403 to get started.
Tri-District Development CorporationThe Tri-District Development Corporation (TDDC) provides long-term rate financing, both fixed and flexible, to qualified businesses in the 29 parishes of North Louisiana. Staffed through offices in Shreveport, Monroe and Alexandria, the TDDC provides business development financing for companies creating long-term permanent employment, primarily in the rural regions of North Louisiana (the loan types are similar to those offered by AIDC).
Contact the Coordinating and Development Corporation at 318-632-2022 with questions.