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 Attorney Spotlight |
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Kimberly concentrates her practice in the areas of financial services, commercial contracts, real estate and corporate law. Kimberly has extensive experience representing banks, financial institutions, as well as companies in connection with commercial financing transactions, including acquisition financing, asset-based financing, healthcare receivable financing and other secured transactions. She has experience with intercreditor relationships, as well as creditor's rights in bankruptcy. Kimberly also advises small businesses on corporate governance and transactional matters.
Kimberly is admitted to practice before the Supreme Courts of Pennsylvania and New Jersey and the Federal District Court for the Eastern District of Pennsylvania. She is a member of the Philadelphia Bar Association and the National Association of Government Guaranteed Lenders (NAGGL).
Kimberly is a graduate of Drexel University where she received a Bachelor of Science Degree, cum laude, and the James E. Beasley School of Law, Temple University, where she earned a Juris Doctor degree.
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SBA Announces Maximum Fixed Rate
By Ethan W. Smith |
 Historically, SBA has been permitted to publish a maximum allowable fixed rate for its guaranteed loans in the Federal Register, see 13 CFR 120.213(a). However, up to this point, the Agency has not done so. Lenders have been reluctant to make fixed rate loans under the 7a program because they have been restricted to a maximum rate equal to the Prime Rate (or LIBOR Base Rate) plus the maximum rate spreads identified in 13 CFR 120.214 (d) and (e) and 13 CFR 120.215. Currently, this results in a maximum rate of approximately 6.00%, which is not a rate most lenders are willing (or able) to lock in at for a long-term loan. Yesterday, the SBA published in the Federal Register, its guidelines for calculating fixed rates for long term 7a loans, effective October1, 2009. This announcement was immediately publicized to the lending community by Tony Wilkinson, President of NAGGL (a copy of the NAGGL press release is available here). The new guidance establishes a calculation for a "Fixed Base Rate" which is equal to the LIBOR Base Rate plus the average of the 5-year and 10-year LIBOR SWAP Rate (each as established on the first calendar day of the month). The maximum allowable fixed rate for 7(a) loans (excluding SBA Express and Export Express) will be calculated using the Fixed Base Rate plus the same spreads available on variable rate 7a loans, typically between 2.25% and 2.75%. See 13 CFR 120.214 (d) and (e) and 13 CFR 120.215. Accordingly, the maximum fixed rate for loans with a maturity greater than seven years would be 9.17% using the September, 2009 LIBOR Base Rate (3.26), plus the average 5 and 10 year LIBOR Swap Rates (3.16), plus the maximum spread (2.75). "This is good news for lenders and borrowers" says Bob Stephan of Coastal Securities, "Borrowers want to take advantage of this low interest rate environment to lock in a fixed rate, but lenders need a rate higher than what was previously allowed, in order to make offering a fixed rate feasible." Additionally, Stephan says that lenders can sell the guaranteed portion of their fixed-rate loans for a premium in the 4 point range and can still retain a 1% servicing fee, thereby reducing their exposure to these fixed rate loans. The new maximum fixed rate policy is effective for loans submitted on or after October 1, 2009. For more information, contact the author at 215-542-7070 or esmith@starfieldsmith.com or visit our website: www.starfieldsmith.com.
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Did you know... |
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...that Starfield and Smith, P.C. advises its lender clients on both SBA and Federal Bank regulatory matters?
For more information on this and the other services Starfield and Smith, P.C. provides to its lender clients, please contact David Starfield at (215) 542-7070 or email David at dstarfield@starfieldsmith.com.
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Upcoming Seminars and Events |
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"Rediscover Herndon: Prepare Perfect Purchase Requests"
Presented by David W. Starfield for the NAGGL Annual Conference
Dates: October 27 and 28, 2009
Loacation: Phoenix, AZ
For more information and to register, click here.
To use NAGGL's online registration system, click here.
"Rediscover Franchise Lending"
Presented by Michele Courneya for the NAGGL Annual Conference
Date: October 27, 2009
For more information and to register, click here.
To use NAGGL's online registration system, click here.
"Understanding the SOP 50-10"
Presented by Michele Courneya for the NAGGL Annual Conference
Date: October 29, 2009
Location: Phoenix, AZ
For more information and to register, click here. To use NAGGL's online registration system, click here.
"Guarantee Purchase Process and Package Submission"
Presented by David W. Starfield for the NAGGL Annual Conference
Date: October 30, 2009
Location: Phoenix, AZ
For more information and to register, click here.
To use NAGGL's online registration system, click here. For additional information, please contact us or visit our booth (#47) at the NAGGL Annual Conference, October 26 - 28
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Starfield & Smith, P.C.
Pennsylvania Office
501 Office Center Drive, Suite 350 | Ft. Washington, PA 19034
phone: (215) 542-7070 | fax: (215) 542-0723
Minnesota Office
1516 West Lake Street, Suite 303 | Minneapolis, MN 55408
Loan Documentation | Closing | SBA Guaranty Repurchase
Regulatory Compliance | Franchise Eligibility
Business Consulting
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