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Eligible borrowers:
Small businesses
Eligible systems:
PV (including grid-independent) and solar thermal systems, plus many other renewable energy systems and efficiency measures must have a positive effect on business cash flow
Loan Amount:
Up to $750,000 guaranty for 7(a) loan
Guaranty:
Can be 80% up to $100,000; 75% if greater than $100,000
For more Info:
(800) 8-ASK-SBA
www.sba.gov
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The Small Business Administration (SBA), an independent agency of the Executive Branch of the Federal government, is charged with providing advocacy, management, procurement, and financial assistance to American small businesses.
SBA provides business loans to eligible and creditworthy small businesses by guaranteeing loans made by participating lenders. The guaranty transfers the risk of borrower nonpayment, up to the amount of the guaranty, from the tender to the SBA. Therefore, businesses applying for an SBA loan are actually applying for a commercial loan having an SBA guaranty.
Under this concept, when a business applies to a lender for financing, the lender first decides whether it can make the loan itself or if certain aspects of the application require an SBA guaranty. The SBA guaranty is available only to the lender. The government will reimburse the lender for any loss, up to the percentage of SBA's guarantee. Under this program, however, the borrower remains obligated for the full amount due.
Lenders generally seek a SBA guaranty after they have evaluated the credit merit of the application and determined that a SBA guaranty is needed. Through its guaranty, SBA can help tens of thousands of businesses each year obtain financing that would otherwise not be available.
A key concept of the 7(a) guaranty loan program is that the loan actually comes from a commercial lender not the government. The lender may be unwilling to provide the loan even with the SBA guaranty, and this is permissible. The agency does not make loans by itself. It is important that applicants know the criteria and requirements of lenders as well as those of the SBA.
Information Provided by the U.S. Department of Energy
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