For the majority of CAPLines, the servicing fee is capped at 2%. Qualifying assets include “equipment, buildings, accounts receivable, and in some cases, inventory.”. The first round of $349 billion in funding for the Paycheck Protection Program ran out in less than two weeks. The online lender becomes one of a handful of Fintechs in the UK facilitating the program. If you’ve ever researched small business financing, you’ve likely heard of SBA loans. For example, as we have previously reported, there was initial uncertainty about whether nonbank fintech companies would be able to participate, as the Treasury and SBA were in a time crunch to get the program up and running, and the lender application did not initially include fintech lenders – only federally insured depository institutions, federally insured credit unions, and certain farm credit institutions. Combined, these rates will make up your total SBA/CDC 504 loan rates. SBA CAPlines are a good option for small businesses that pay upfront for goods or services before receiving payment themselves. We use cookies to ensure that we give you the best experience on our website. The interest rates on the CDC loan are based on the current rate for 5-year and 10-year U.S. Treasury bonds. SBA 7(a) loan rates currently range between 5.50% to 9.75%. Something to remember about the SBA loan approval process is that you’re not knocking on the government agency’s door for financing. If you identify any errors, take the time to have the mistakes resolved with the credit bureaus before you apply for a loan. Annualcreditreport.com is a great resource that can provide you with these reports for free. When pursuing an SBA loan, patience is a virtue. Privacy Policy. (Photo by John Tlumacki/The Boston Globe via Getty Images). If you’ve been unable to apply for a PPP loan through a national or regional bank, below are nonbank and alternative lenders to consider—plus some tips on how to evaluate them. The Paycheck Protection Program is a $350 billion program authorized by the CARES Act, and includes provisions for loan forgiveness up to 100%, if the proceeds of the loan are used for certain payroll costs, interest on mortgages, rent, and utilities. As a nonbank lender licensed to make SBA 7(a) loans, Fountainhead originally accepted, from any small business, not just existing customers. Similar to SBA Express loans, there is a faster turnaround time on the application process than with the standard SBA 7(a) loan program. The law sets aside $60 billion for small- and medium-sized community banks and credit unions and less traditional lending companies that are SBA-approved. Copyright © 2019 Funding Circle Limited. Crowdfund Insider is the leading news and information web site covering the emerging global industry of disruptive finance including investment crowdfunding, Blockchain peer-to-peer / marketplace lending and other forms of Fintech. Examining the CDC portion of the SBA 504 Loan: The CDC can cover up to 40% of the loan, and the SBA sets limits on the rates and fees given by the CDC. Are there limitations of how I can spend my paycheck protection program funds? That will help you avoid submitting an application that ends up languishing, without getting funded. While the lender is the one evaluating your application and determining an interest rate, the SBA does set a maximum rate that the lender is not allowed to exceed. Digital Assets Insider® When most people talk about an SBA loan, they’re usually referring to this type of loan, because the use of capital is flexible and can be applied to just about any business purpose. Funding Circle is authorized to provide SBA-backed loans ranging from $10,000 to $2,000,000. Fintech Insider® That’s not to say you don’t have options. Previously, she covered credit cards and related content at other national web publications including NerdWallet, Bankrate and HerMoney. BOSTON, MA - APRIL 22: Asia Mei, owner of Moonshine 152, poses in her restaurant, which has been ... [+] shut down due to COVID-19, on April 22, 2020. But … Notably, Funding Circle announced it will be providing support to applicants in four languages — English, Spanish, Mandarin, and Hindi, exemplifying just one of the ways that fintechs can make sure money gets to minority communities and smaller businesses, and reach customers that some traditional banks don’t. Small Business Administration (SBA) loans.