America is currently home to millions of veterans. Their sheer numbers and the service that they provided to the nation qualify them as a special interest group. While most of them are abled, there is also a large number who are disabled in one way or the other. A large section of the veterans have excellent business ideas that they yearn to realize. The major obstacle standing in their way is the lack of knowledge on where they can access funding.
If you are a veteran who has also been mulling the idea of starting a business you will be glad to know that there are facilities that especially cater for your situation.
A lot of opportunities for getting a loan have been coming to the fore in recent years owing to the great success rate that has been experienced in veteran owned businesses. The business acumen of veterans has proved to be exceptional. This has prompted the government to enact laws that cater for the business financing needs of veterans. This is with regards to initial capital, expansion needs and inventory financing.
Some of the avenues that can offer you small business loans for veterans are:
- The patriotic express loan program as administered by the US small business administration (SBA) in conjunction with the US department of veterans’ affairs.
- Private finance houses
Loans that are provided under the patriot express program are guaranteed by the SBA which in itself is not a lender but a facilitator. These loans can only be accessed through [participating lenders such as banks, finance houses etc.
What Is Required?
As a basic rule, you have to produce:
- 1. Proof that you were honourably discharged
- 2. An eligibility certificate issued by the office of veterans’ affairs
- 3. Proof that you own 51% of the business or stand to do so.
What Are The Terms?
- As a disabled veteran, you stand to receive a loan amount of up to US$500,000 under the patriot express program.
- The interest rates are regulated by the SBA and have gazetted restrictions in terms of how much they can vary from the prime rate as published in the wall street journal.
- The loan term is less than seven years and any extension in this period can attract an extra 1 to 2 percentile increase in the rate.
- The loan application turnaround time is anywhere between 2 to 6 weeks
Can I Get A Business Loan With Bad Credit?
Private lenders have chipped in to help with the problem by offering financing to veterans with bad credit. In such cases where you want to get a small business loans for veterans the issue of collateral comes into play and the interest rate will be a bit higher than for government issued loans.
Private lenders can also issue loans for veterans with good credit and a solid business plan. Under these circumstances, the turnaround of the loan application will be faster and the interest rate not much higher than the government level. You can find some of these lenders online.