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Emailed by the National Association of Government Guarantted Lenders to its members.
Nothing may be reprinted in whole or part without written permission from NAGGL.
All rights reserved. © 2009, NAGGL, Inc. |
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| 2010 SBA Lender Management Retreat |
New Orleans
February 3-4
The economy is easing out of a crippling recession and SBA lenders are paving the road to recovery by responsibly providing small businesses the access to credit they need to create and retain jobs in order to power growth. At the same time, the agency and the parameters of the 7(a) program are transforming in response to restructured realities --and we're all realizing that the industry is undergoing a paradigm shift. The retreat will be a freewheeling exchange of ideas and best practices to help SBA lenders discover strategies to excel in the "new normal".
Retreat Location:
Westin New Orleans Canal Place
100 Rue Iberville
New Orleans, LA 70130
www.westin.com/canalplace
Reservations: 800.228.3000
504.566.7006
Rate: $169
Hotel Cut-Off: January 15
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| Upcoming Events |
WEBExpress
December 8
Ask the Lawyers -- Avoid Closing & Documentation Pitfalls
Thomas Hofstetter (Schenck Price Smith & King) and David Starfield (Starfield & Smith) provide expert guidance and practical tips on avoiding pitfalls when closing and documenting loans.
NAGGL will participate in sessions at the GLQC event, and, on February 24, attendees and others in the region can join one of the industry's most respected instructors, Jane Butler, for a special half-day training session on Establishing Internal Policies and Procedures for SBA Lending and explore the importance of having comprehensive written lending policies for both your SBA and non-SBA loans, and to get suggestions for writing internal guidance that will satisfy SBA's requirements--and that are "commercially reasonable and prudent" for today's environment. Register directly with NAGGL after December 11 or email. Fee is $225 for SSBLC attendees.
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Save the Dates!!
Huntington Beach, CA - SBA Lender Training - March 8-11, 2010
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| Resources |
SBA Fixed Base Rate
November = 6.11%
SBA LIBOR Base Rate
December = 3.23%
SBA Peg Rate
October to December = 4.0%
Servicing & Liquidation Matrix - Version 4 - Effective 11/12/2009. A further clarification of SBA's interest rate policies and the reinstatement of the requirement that SBA approve all pre-disbursement loan authorization changes on loans approved under the standard process. Get It >Where to Mail G-845 - Document Verification Request - More > |
| Daily News |
Get your fix of important daily SBA lending news in one convenient location. Visit every morning as you enjoy that first cuppa Joe! |
| NAGGL Job Bank |
SBA Lending Specialist position in San Luis Obispo, CA. More >
Post your resume for free. More >
Employers
Post job openings that reach your target audience for $150 for 30 days! |
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In the News |
December 3 NAGGL update video Record $1.7 billion gross SBA 7(a) loan volume in November is further proof that stimulus provisions critical in providing small businesses the financing needed to create and retain jobs and move the economy forward. Now that stimulus funds for the 7(a) program are exhausted, lenders are reminded to cancel all Recovery Act loans that will never be disbursed in order to give another small business borrower now waiting in the Recovery Act Loan Queue an opportunity at success. Lenders are reminded that the Continuing Resolution under which the federal government is functioning (signed into law in early November) makes funds available for all of FY 2010 for 'regular' 7(a) loan processing (that is, 'normal' guarantee level and fees]. Gross loan approvals data >
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Op-Ed: Stimulus act's loan program proves a small-business boon
Scott Hague, president of Small Business California - Get It >........................................................................
Sen. Landrieu commends Administration for focus on small business -- White House Jobs Summit puts emphasis on entrepreneurs"Now that we have stabilized Wall Street, it is time to jump-start Main Street. As Chair of the Senate Small Business Committee, I have heard time and time again that this begins with getting small businesses greater access to the credit they need during these tough economic times. That is why I am working with my colleagues to increase the loan limits on small business loans and extend the small business provisions in the Recovery Act. Like us in the Senate, the President and his administration are focused on strengthening small businesses because we all know small businesses are the engine of our economy. We must give them the fuel to grow, create jobs and lead our country back to a time of prosperity." ........................................................................
Op-Ed: Congress should replenish loan fund for small business
Tony Wilkinson
Confirmation by the Obama administration that the economic stimulus funds earmarked for the U.S. Small Business Administration's 7(a) loan program have run out is bad news for small business and the workers they employ. But the depletion of the funds is also proof that the loan program was, and is, a critically important part of the nation's efforts to recover from this deep recession. Small-business owners were able to have the credit needed to create and retain jobs. Get It >
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Treasury Department - Small business performance and credit conditions in the current recession
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Unlocking Credit for Small Businesses: The Key to Recovery and Job Creation on Main Street
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November 18 Small Business Forum - Treasury Department & SBA
Report to President Obama -- Small Business Proposals
Secretary Geithner and Administrator Mills delivered their report on the November 18 Forum to President Obama on December 3. Participants in the Small Business Financing Forum - small businesses, lenders, policymakers and regulators - suggested a range of ideas aimed at supporting access to credit and job creation for small businesses. Get It >
(A video of the entire forum is available through the same link.)
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Recovery Act & Non-Recovery Act Loan Queues - Transition Period |
Since funding for Recovery Act 7(a) loan provisions has been exhausted, SBA has set up the transitional loan queues as described in 5000-1131 and a website full of useful information on the queues is available here.
Today's Transition Phase Alert is at Yellow, the second phase of the transition is when loan applications in the Queue begin to experience delays awaiting funding.
As of December 4, there are 35 loans requesting increases under the Recovery Act, and 653 new Recovery Act Loan application requests in teh queue.
HOW to withdraw a Recovery Act application and resubmit as a non-Recovery Act application - Get It >
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| NAGGL Gets Answers |
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HOT TOPIC - FAS 166 Impact on Selling 7(a) Loans
The new accounting rule known as FAS 166 was not created to harm SBA lenders, but designed as a post-Enron fix to ensure that adequate capital is being provided for securitized transactions. In other words, the purpose of FAS 166 is to add transparency and to bring assets and liabilities back to the company's balance sheet so that proper capital can be allocated. However, FAS 166 will adversely impact 7(a) lenders involved in secondary market sales since it states that holding more than the 1% servicing required per the SBA Form 1086 ( Secondary Participation Guaranty Agreement) would result in the disallowance of sales treatment. This means the transaction must be treated as a secured borrowing with a pledge of collateral. The transaction must remain on a bank's balance sheet and have capital allocated accordingly. If your bank is currently selling loans at par, FAS 166 will impact your balance sheet.
Lenders who sell at a premium will also notice some dramatic changes once FAS 166 goes into effect. Lenders will no longer be able to record a gain on sale at the time of settlement. The 1086 currently calls for a 90-day warranty period and requires that the first three payments be made in the month in which they are due. If those two provisions are not met, the premium is reimbursed to the buyer per the warranty. FAS 166 does not allow sales treatment until the warranty period expires. Therefore, the recognition of the gain on sale will be delayed for at least 90 days.
Presentation by Bill McGaughey & Stuart Mitchell at the 25th Anniversary Conference - Get It >
504 Refinancing - Definition of "Expansion"
Q: Paragraph (b) on page 280 of the 50-10 states that refinancing is permissible if ". . The project involves the expansion of a small business applicant . ." (along with several other qualifications).
Later in the same paragraph it states that - "Expansion" includes any Project that involves the acquisition, construction or improvement of land, building or equipment for use by the small business applicant.
I am being approached by a local veterinarian who wants to refi a year old mortgage he took out under his LLC. The project qualifies under all other 504 refinance rules (he is going to sink quite a bit of renovations into the project). My concern is that he will be opening a new practice (the operating company has not yet been formed), and the loan will be ineligible because it is a startup, not an expansion.
I'm confused by the definition of "expansion" in paragraph b). Can you clarify?
A: I spoke to one of the SBA District Counsels that drafted this section and also revised the regulations on 504 refinance. SBA defined "expansion" very broadly to allow as many borrowers as possible to be eligible to use 504's for refinance if it makes sense. Just because a business is a start-up does not mean they are ineligible for refinancing under the 504 program. A start-up business may be "expanding" a site to meet their new business needs, and this meets the definition of expansion intended by the rule.
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Helpful Resources from National Guaranty Purchase Center |
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Watch SBA Administrator Karen Mills' Keynote Address
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2010 Standing & Regional Liaison Committees Interested in serving on a committee for the 2010 calendar year? Get Involved. We need you! Send your complete contact information, indicating which committee you wish to serve on, and include details of your SBA lending experience by December 11, 2009. More > | |
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National Association of Government Guaranteed Lenders, Inc. (NAGGL)
© 2009, NAGGL, Inc.
All rights reserved. Nothing may be reprinted in whole or part without written permission from NAGGL. www.naggl.org | |
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