2011 SBA eblast header

Your Monthly Update on Rates and Industry News

September 2011

 

 

 

SBA 504 Franchise Financing 

 

The Small Business Administration (SBA) recently provided national data on SBA 504 franchise activity from 1986 through September 2010. During this period, nearly 850 franchises received an astounding 9,685 loans.

 

More recently, between 2008 and 2010, SBA provided 2,276 franchise loans for a total exceeding $2 billion. Sixty-nine percent of the dollar volume and 61 percent of the loan volume were with the top 50 franchises, which received 1,388 loans for $1.3 billion. 

 

For charts and additional information, visit NADCO at www.nadco.org. The complete 504 Franchise Financing Report 1986-2010 is posted under "504 Statistics."

 

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September Headlines
 

 

St. Louis Lenders Get Boost From Low Rates   

With mortgage interest rates at another record low, loan applications are spiking in St. Louis.

 

St. Louis Restaurants Rewrite Menu to Get Financing

In St. Louis, the SBA has made 26 loans totaling $8 million to restaurants in the metro area so far this fiscal year.

 

September Rates 

4.54%
SBA 20-year fixed

 

3.53%
SBA 10-year fixed
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3.23% - 5.23%
BOOST 
variable rate

 

4.98% - 6.98%
BOOST
five-year fixed
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for complete listing of August rates. 
Tip of the Month: Environmental Reports

 

Both lenders and CDCs condition their commitments on three main authorizations: credit, appraisal and environmental. As you navigate the environmental authorization process bear in mind:

  1. The bank lender (third party mortgagee) drives the environmental report process
  2. SBA approval of the environmental analysis takes at least three days.
  3. Before authorization can be given, SBA lawyers must review and approve the environmental reports.
  4. The minimum environmental analysis is an Environmental Data Report (EDR), known as an environmental background check with risk assessment.
    1. EDR findings may require a full Phase I analysis.
    2. Subsequently, Phase I may recommend a Phase II analysis and possible remediation.
  5. The environmental company must submit a copy of its insurance certificate and the reliance letter (obtainable through St. Louis County Economic Council).

For additional questions, please contact Steve Grelle at 615.7681.

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