STOP PRESS!!!
ATTENTION small business owners who could benefit from the SBA 2009 Recovery Act.

23 November UPDATE

FUNDED! It has taken more than 158 days from approval, at least a forest worth of trees, hundreds of emails, support from the Internal Revenue Service (yes!) and a great deal of patience. The funding institution chose to use our home as collaterol! That meant USD$339.00 in CLOSING FEES!!! Bummer!

LESSONS LEARNED:

Know that "application approval" does not mean "loan approval." The process is (1) Acceptance, (2) Approval, and (3) Funding.

Know that the SBA ARC LOAN process is a disaster! It is just plain displicable! The bankers HAVE NO CLUE. The idea was to inject funds into going entities that were experience some sort of immediate hardship. I understand that Senator Snow has introduced a bill to STOP the program.

Be prepared to submit a ton of paperwork even though the bank may not rely on it to make its decision.

Download ALL SBA-ARC documents, regulations and procedural manuals!  I MEAN ALL OF THEM. I became as up to date on SBA-ARC Loans as any banker.

It will take more time and work than you expect. I have been congratulated by the SBA for getting the loan; however, it remains unfunded as of this date . I started the process on 11 Jun 09.

Apply to more than one financial institution. Maybe three. The law says that one may receive only one SBA ARC Loan. 

                                                                                              SBA says:  

- Deferred-payment loan up to $35k
- Must be an existing (minimum two years), viable, small business in the U.S.
- Funds can be given out over six months, followed by 12 months with no repayment of principal, followed by a repayment period of five years.
- SBA pays monthly interest to the bank.
- Must have an established banking relationship.

RESULTS:

Chase said no. They refused to use forecasted cash flow. Only used past two years average cash flow. Also, they defined "immediate hardship" as having occurred in the past, as in last year or the year before. The fact that our business income came to a screaming halt last September (went from more than $7,000 per month to zero), was no considered.

Local Federal Credit Union said YES. They were willing to deal and much more attuned to small business (micro enterprise) than the banks; however, they continue to stall! I was informed more than three weeks ago that I had satisfied all documentation requirements and that it would take 2-3 days to pull the closing papers together. THREE WEEKS AGO!!!!!!!!

 Click here for more information about the SBA ARC Loan Program.