New Business Loans Available to Military
Wednesday, June 13, 2007; 3:24 PM
The Small Business Administration on Wednesday unveiled a new loan initiative designed to aid the military community.
The Patriot Express Initiative includes new programs as well as expanded ones for veterans and members of the military community who wish to establish or grow a small business.
"We are reaching harder to put together a program so that more veterans would have access to capital than they would have through our traditional programs," said SBA Administrator Steven Preston in a Monday interview.
The loans can be used to start up or expand a business, purchase equipment, provide working capital, fund inventory, or go toward office space.
"Generally, through our research, we've found that veterans make good business owners and the degree of business ownership among veterans is higher than other demographics," said Preston. "They come out [of the military] well-trained. They come out disciplined, and we want to make sure that every opportunity is available to them to start a business."
Eligible military community members include veterans, service-disabled veterans, reservists and National Guard members. Certain spouses also are eligible, including the widowed spouse of a service member or veteran who died during service or of a service-related disability. Active-duty service members participating in the military's Transition Assistance Program, which offers job-search assistance to service members transitioning to civilian life, also may apply.
Sen. John Kerry (D-Mass.), the chairman of the Senate Small Business and Entrepreneurship Committee, sent a letter (pdf) Wednesday to Defense Secretary Robert Gates, Veterans Affairs Secretary Jim Nicholson and Preston requesting updates on how the administration is implementing veteran small business programs, citing the new Patriot Express program as an example. He expressed concern over a lack of coordination between agencies and departments in their efforts to educate members of the military community about opportunities like special loan programs available to them.
Kerry requested that the officials provide his panel with monthly reports "on how the agencies are working together" to market the loan program and the Military Reservist Economic Injury Disaster Loan program, which caps certain loans at 4 percent.
The SBA is working with a group of specific lenders nationwide to offer these loans for up to $500,000. For loans greater than $350,000, lenders are required to take all available collateral. The loans are expected to be offered at about 2.25 percent to 4.75 percent over prime, depending on the loan's size and complexity. Local SBA district offices have lists of Patriot Express lenders.