A few weeks back I wrote about changes that had been implemented to various SBA programs as part of the Obama administration’s stimulus package. The changes reduced fees, increased loan-to-value ratios and generally made the process a bit easier for banks and borrowers. For business owners seeking to purchase, build or refinance owner-occupied properties it looked like SBA loans were the way to go.
Despite the $730 million in stimulus funds given to the SBA in February, the number of SBA loans declined 36% in the fiscal year 2009. But the administration is not giving up.
Last week the president asked Congress to reallocate TARP funds to community banks to increase small business lending. If approved it would allow community banks to borrow at 3% rather than the current 5% rate. The president also asked Congress to increase SBA 7(a) loan guarantees to $5 million from $2 million and to increase 504 loans to $5 million from $2 million.
This change in the SBA programs could help the commercial real estate industry with financing on owner-occupied offices, stores and manufacturing facilities. It could also help franchise owners with their branded facilities as well. And it would put the funding with community banks rather than the larger banks.
In Louisiana it is a community bank leading the pack of SBA lenders for the second straight year.
According to an SBA press release, New Orleans-based Gulf Coast Bank and Trust approved 157 SBA 7(a) loans in Louisiana totaling $21 million for the fiscal year ending September 30 making it the largest SBA 7(a) lender in the state both in terms of dollar volume and the number of loans.
In total there were 527 SBA 7(a) loans approved in Louisiana for a total of $113,450,250.
Gary Littlefield, Baton Rouge-area market president for Gulf Coast Bank and Trust, says the bank was “very proud to be recognized for the second straight year as Louisiana’s Top SBA Lender” and that his “commercial lending staff has done an excellent job working with all of our business clients to ensure that the process is handled smoothly and professionally.”
As I said a few months back, if you have an owner-occupied property in need of financing but have not considered SBA financing, it might be time to take another look.
(Brian Andrews is a certified mortgage banker specializing in the financing of commercial real estate. His business is Andrews Commercial Mortgage and he can be reached at brian.andrews@acmla.com.)
