The Top Economic Recovery Programs For Small Business Will Expire In September Unless Congress Acts
Check out this article called “Top Economic Recovery Programs for Small Business Expire In September” by Mercantile Capital Corporation and learn what these programs are and why they will expire…
“ORLANDO, Fla., Aug. 8, 2012 — /PRNewswire-iReach/ — Two of the most effective economic recovery programs expire in late September unless Congress ends its election-year deadlock and extends them. The refinance provision of the U.S. Small Business Administration (SBA) 504 loan program allows small business owners to refinance commercial mortgages with longer-term, below-market, fixed interest rates afforded by the SBA 504 program.
The First Mortgage Lien Pooling (FMLP) program creates a secondary market where lenders can re-sell a portion of SBA 504 first mortgage loans, allowing them to increase their liquidity and capacity to make more small business loans. Both initiatives face expiration at the end of September.
SBA loan volumes increased in late 2011 and 2012 due in large part to the SBA 504 refinance and FMLP programs. According to SBA data, SBA 504 refinances accounted for 14.7 percent of all SBA 504 loans made in the first quarter of 2012, and 20.6 percent of total SBA 504 dollars during that time period. Nearly 15 percent of all SBA 504 loans made today are FMLP loans. Both government initiatives are self-funded by supplemental fees to program applicants and lenders.
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