Companies will endure SBA red tape if it leads to cash - Baltimore Business Journal:

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So the laid-off bond tradert is dipping her toes into the retail with the hope of opening KStaton Boutique. The clothing stors would caterto plus-sized women, from size 14 to 30, fillin g a niche that will hopefully help it avoid the fate of so many store that have closed during the recession. But first, the Catonsville residenf needs $100,000 in capital. She is hittingg up area banks fora U.S. Small Business Administrationj loan. After being turned down by one bank, she is waitiny to hear from two others.
Greefr is like other entrepreneurd who are turning to the Small Busineszs Administration as tight credit has made lending from privat investors and regular bank loans SBA lenders, including some traditional banks, say therwe has been an uptick in interest in SBA loansx since the agency received federal stimulus money that made the loan progra more attractive to small businesses. It eliminated fees on its basixc loans, which can save thousands of dollars, and increased the maximum guarantee on a loan from 85 percent to90 “If you put a lot of moneyt behind something, it will get said Todd Marks, CEO of Mindgrub Technologies LLC.
The Ellicotyt City firm receiveda $25,000 SBA line of credit in Marchn from , the region’s largest SBA “I know the SBA is getting a lot of Consequently, entrepreneurs like Greer are hopeful they can get the moneuy to start a new company. Others, who have existingh businesses, are turning to the SBA as a lifeliner to keep theircompany afloat. But don’t expect to walk into a bank and come out with a wad of Lenders and business owners say that you need to be armec with plenty offinancial documents, collateral and good credirt history. Take for instance, Steve Ko, who last monthg received a $50,000 SBA-backed loan from to open Oakey’w Grill.
Restaurants are risku ventures that can be tough to fund even in good But bank executives say they loaned the money forthe pit-beefr sandwich shop because Ko maintains a good credit rating. He also knows something about the industry as his family has operated delis and other businesses in Howard County for 30 Experience makes you a better candidate fora loan. Bankz also take a look at your assets. For SBA loanws greater than $50,000, banks want 100 perceny collateral fora startup, said Craigb J. Panos, a business counselor at the Marylane Small Business Development Centerin Towson.
So if you want to borrow $100,000, you should expect to have $100,0090 in collateral, most often your That can be difficult for many business owners whos e home valuesare dropping. SBA lenders are scrutinizinhg loans more than ever because of thecredi squeeze. It can take three to four monthsa to get aloan approved, Panos said. Prepard to supply bank documents, your businessw plan and details on how you will spendthe money. Davie Janocha did not mind filling out the 25 pagee of SBA forms to getthe $75,000 SBA-backed loan this year for his electronicd fingerprinting company LLC. He applied for and receivede another $25,000 line of credit in Marcu through inGlen Burnie.
“Igf you are not an organizec person then it would bea hassle,” said who keeps all of this financialk documents in ready-to-access files. “Iu know where every dollar is.”