If you’re waiting for the right time to start a small business or expand on an existing business, 2011 may mark the year where your wait is over. Because of the Small Business Jobs Act of 2010, Heather Endresen, manager of SBA lending at Union Bank, has made some predictions for 2011 that predict a small business friendly lending environment.
The Small Business Jobs Act of 2010 will inject $30 billion in to small banks for the sole purpose of lending to small businesses in their community. Along with a much larger level of funding, the new law provides even more money for women and minorities to encourage small business growth in these demographics.
Endresen predicts these five trends in 2011:
More Business Lending
Lending will most likely increase in 2011 but why? First, with the economy slowly improving and access to funds easier, small business owners and aspiring entrepreneurs will ask their local banks for funding. The volume of requests will increase significantly from 2009. Second, with more money to lend, banks will loosen their lending standards. Although only slightly, more businesses will have access to funds that they didn’t used to have.
There’s no disputing the fact that doing business in the most Earth friendly way possible is an important initiative for the Federal Government. Because of this, banks will offer special lending for those business who want to lower their carbon footprint. Improvements such as solar panels are just one form of renewable energy that will be pushed.
The new law allows 504 loans from the SBA to be used to refinance commercial property. Lower interest rates as a result of refinancing could potentially help ease the financial pressure on small businesses which were affected by The Great Recession of 2009. Not only can the 504 loan be used for real estate loans, all fees to banks and borrowers are waived.
Go Ahead and Export
A variety of incentives are available for those who have business where goods are exported. In addition, loans of up to $350,000 are guaranteed by the SBA at 90%.
Many small businesses know that government contracts are often long term and also lucrative for small businesses. This is largely because the Federal Government routinely awards contracts to small businesses including consideration for women and minorities. The Small Business Jobs Act helps to level the playing field giving small businesses even more of an ability to compete for lucrative contracts.
If you were waiting for the right time, the Small Business Association is making it easy for small businesses to gain financing with little work. Take advantage of these programs while they last.