- change ups
SBA loans were up this fiscal year
Proos Manufacturing did not receive an SBA-guaranteed loan; it was a conventional loan from Fifth Third Bank. But a lot of other companies in America did avail themselves of SBA-backed loans from early 2009 through July 2010.
Compared to the prior federal fiscal year, SBA loans to small business in West Michigan increased by 33 percent from Sept. 1, 2009, through the current federal fiscal year ending Oct. 1, according to Brian Picarazzi, senior area manager for the SBA’s West Michigan office in Grand Rapids.
The 33 percent increase was in the 7(a) category of loans; the 504 loans increased by 23 percent during the fiscal year, he said.
“We can attribute some of that to the Recovery Act funds we’ve had in place,” said Picarazzi.
“We have noticed a drop-off since those funds expired.”
But he added, “We have to focus on the positive: Lending is up.”
In February 2009, the American Recovery and Reinvestment Act allocated $375 million to the U.S. Small Business Administration to increase the SBA guarantee to banks on 7(a) loans, and to reduce the borrower’s fees on most 7(a) and 504 loans.
The stimulus funding was renewed a couple of times during the current federal fiscal year because the demand was so high, but the last renewal expired in July, according to the SBA website.