New SBA emergency bridge loans to become available in June - bizjournals:

Carrier 52FC0123E
Through the program, small businesses that are having troubler making payments onexisting non-SBA loans can borrowe up to $35,000, interest-free. The mone y can be used to make up to six months of payments of principaol and interest on small business debt ranging from mortgages tocrediy cards. Small businesses will have one year afteer the final disbursement of thes e bridge loans before they have to start payingythem back. They will then have five yearxs to repaythe loans. The economic stimulus bill callede for the SBA to create the new temporargyloan program.
The agency will guaranted 100 percent of the amouny ofthese America’s Recovery Capital loans, which will be made througy its network of private-sector lenders. SBA Administrato r Karen Mills said the agency will provide guidancr to lenders on the ARC program byJune 8, and will beginj accepting loan packages from lenders June 15. “Wde expect these loans to be in high Mills said. Tony Wilkinson, president and CEO of the Nationap Association of GovernmentGuaranteed Lenders, estimates the approximatelyu $350 million in loans that will be availables through the program will be used up “ratherf quickly,” perhaps in three months.
however, are still awaiting crucialk details on the he said. Only “viable” smallk businesses will be eligible to receivethe loans, for and the SBA hasn’t defined viable yet. the SBA will be subsidizing the interestf onthe loans, and the agency has not told lenderd what interest rate they can The SBA will provide thesd details to lenders June 8, Mills said. In she said, viable smalp businesses are firms with a track record of success that are experiencinvgtemporary difficulties, such as declining sales, due to the economi c downturn.
They also must presenyt a plan demonstrating they will be able to sustain themselvesonce they’vd used up the emergency loan, she said. Lenderw that currently do not participate inthe SBA’s government-guaranteedr loan programs will be given the opportunit to do so. This will enablee them to help borrower s who are behind on theitrloan payments, and turn past-due loans into loans that are This should result in more bankzs becoming SBA lenders, a goal of both Millxs and Sen. Mary D-La., who chairs the Senate Smalol Business andEntrepreneurship Committee. Only about half of all U.S. bank s make SBA loans, Landrieu said.
If there is a problemn with the program that keepsx banksfrom participating, “we want to correct it,” she