NEW SBA Regulations!
Implementation of Section 501 of the Recovery Act – Fee Elimination Provisions
On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009 (the “Recovery Act”) (P.L. 111-5). Section 501 of the Recovery Act authorizes SBA to reduce or eliminate certain fees on 7(a) and 504 loans. The purpose of this Notice is to announce the implementation of fee eliminations in the 7(a) Loan Program and the 504 Development Company Program. A notice on this subject will also be published in the Federal Register.
7(a) Loan Guarantee Fee Eliminations: For 7(a) loans approved by SBA on or after February 17, 2009, SBA will temporarily eliminate the Small Business Act section 7(a)(18)(A) fees (upfront guaranty fees) for all eligible loans, including those made with higher SBA guarantees (up to 90%) as provided in section 502 of the Recovery Act.
This is very good news from the SBA and it essentially means:
7(a) loan amounts now go up to $1.67 Million and will have a 90% SBA Guaranty (was previously 75%).
SBA Guaranty fees are waived on all SBA 7(a) & 504 loans.