In an effort to get more money out to existing or start-up small businesses, the Northern Maine Development Commission Business Finance Division has waived title and life insurance on Small Business Administration microloans of $10,000 or less.
“We have a pot of money which is available, but for smaller loans of $10,000 or less the extra costs of life and title insurance make them less attractive,” said Duane Walton, director of business finance.
Walton said that is not the only change.
“We have also waived the origination fee for loans under $10,000,” he said.
Walton said there is about $800,000 in that program to loan, with a maximum loan amount of $50,000.
“These are truly for small businesses, startups and expansions,” he said.
The Small Business Administration (SBA) Microloan Program is to provide short-term, fixed-rate, fixed-payment loans to start up, newly established and growing small businesses. Borrowers may use the funds for working capital, inventory, supplies, furniture, fixtures, machinery and/or equipment.
Walton said these SBA loans may be a good option for entrepreneurs because they come with some technical assistance, which can be very valuable to a novice businessperson.
“We can provide ongoing technical assistance to the borrower to help them sustain or grow their business,” he said. “The assistance comes from grant money associated with the loan, so there is no additional cost to the borrower for this help.”
For more information on the SBA Microloan or other lending options at NMDC contact the business finance division at 498-8736 or by email at dwalton@nmdc.org.
