WASHINGTON – Though happy to have been given permission to extend its “recovery lending” program through April 30, the U.S. Small Business Administration is seeking a longer-term extension for the program.
The program, originally part of the American Recovery and Reinvestment Act enacted on Feb. 17, 2009, gave the SBA $730 million to beef up its small business lending program, including $375 million to increase the SBA guarantee on 7(a) loan to 90% and to waive borrower fees on most 7(a) and 504 loans. On Friday, President Barack Obama signed legislation extending additional funds to the program to keep it afloat through April – the third time the program has been allocated additional funds.
On top of the initial $730 million invested in the SBA program, $125 million was extended December 2009, and another $60 million was provided in March. The most recent extension provides an additional $40 million to keep the enhancements to the program afloat through the end of April.
“The increased guarantee and reduced fees on SBA loans helped put more than $23 billion into the hands of small business owners and brought more than 1,100 lenders back to SBA loan programs,” said SBA Administrator Karen Mills. “As a result, average weekly loan approvals by SBA have climbed by 86% compared to the weekly average before passage of the Recovery Act. These programs have been successful in helping jump-start our economy, which is why we will continue to work with Congress on a longer extension of the increased guarantee and reduced fees.”
