Some struggling small businesses will soon be eligible for a much-needed cash infusion thanks to a new government loan program.
Deferred-payment loans of up to $35,000 will be available to qualified small businesses beginning June 15 as part of the federal stimulus package. The interest-free America’s Recovery Capital loans will be 100 percent guaranteed by the Small Business Administration.
“These ARC loans can provide the critical capital and support many small businesses need to make it through these tough economic times,” SBA administrator Karen G. Mills said in a press release. “Together with other provisions of the Recovery Act, ARC loans will free up capital and put more money in the hands of small business owners when they need it the most. This will help viable small businesses continue to grow and thrive and create new jobs in communities across the country.”
ARC loans provide funds for payments of principal and interest for existing, qualifying small business debt including mortgages, term and revolving lines of credit, capital leases, credit card obligations and other debt. Loan repayment will not begin until 12 months after the final disbursement. After the 12-moth deferral period, borrowers have five years to repay the loan principal.
This article was submitted by Katie Kapler, Director of Online Strategy for Biz2Credit. Biz2Credit is a small business marketplace that connects entrepreneurs with financing options and advice to grow their business. Send all questions to email@example.com.