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What Is the SBA Veterans Advantage Program?
The SBA Veteran Advantage Program honors veterans and other qualified individuals with lower fees on all of their popular SBA loan products.
The Small Business Administration guarantees loan products for small businesses in hopes that lenders are able to be more flexible and provide better terms for business owners. As a way of honoring small business owners who are veterans of the armed services, they go even further with the Veteran Advantage Program.
The SBA Veterans Advantage Program
The Small Business Administration has a program in place designed to assist veterans of the U.S. armed forces in acquiring capital to start, grow, or succeed in their business endeavors. The Veterans Advantage Program was established to support veterans, who play a large role in stimulating economic growth in local communities. In an effort to encourage lending to veterans with small businesses, the SBA provides reductions for some loan program fees.
In addition to the reduced fees, the small business administration offers counseling and online training courses aimed at making veterans lender ready. The SBA does this in line with its singular goal of reducing barriers for veteran business owners so that they may have access to more capital and create more jobs. The Veterans Advantage Program extends to any business that is at least 51% owned and controlled by an individual or individuals who meet the following criteria:
Honorably Discharged Veteran(s)
Active Reservist and/or Active National Guard Member
Active Duty Military service members who qualify for the Transition Assistance Program
Current Spouse of any veteran, active duty service member, reservist, or national guard member
Widowed spouse of a service member who died while in service, or as a result of a service-related disability
Loans of up to $150,000: the upfront guaranty fee is zero.
SBA Express Loans: Upfront guaranty fee is zero.
Non-SBA Express Loans: Upfront guaranty fee for loans between $150,001 and $500,000 to veteran-owned small businesses will be 50% less than the upfront guaranty fee for non-veteran owned small businesses as follows:
For loans with a maturity of over 12 months, the fee will be 1.5% of the guaranteed portion; and
For loans with a maturity of fewer than 12 months, the fee will be 0.125% of the guaranteed portion.
Loans of $500,001 up to and including $5,000,000: The upfront guaranty fees for 7(a) loans for veteran-owned small businesses will depend on the loan amount and the maturity of the loan as follows:
For loans with a maturity of over 12 months, the applicable guaranty fees are:
Loans of $500,001 to $700,000: 3% of the guaranteed portion;
Loans of $700,001 to $5,000,000: 3.5% of the guaranteed portion up to $1,000,000 plus 3.75% of the guaranteed portion over $1,000,000.
For loans with a maturity of no greater than 12 months, the guaranty fee is 0.25% of the guaranteed portion.
What are the eligibility requirements for the SBA Veterans Advantage Program?
In order to qualify for the SBA Veterans Advantage program, your business must be 51% owned by an eligible veteran. For the purposes of the program, eligible veterans include:
- Veterans (except for those who have been dishonorably discharged)
- Active duty service members enrolled in the Transition Assistance Program (TAP)
- Current spouse of a veteran, active duty service member, reservist, or member of the National Guard
- Widowed spouses of veterans or service members who died during service or as a result of service-related disabilities
Source: SBA 7a Loans Small Business Blog and SBA Express Loans for Veterans
What types of financing are available through the SBA Veterans Advantage Program?
The SBA Veterans Advantage Program offers two types of financing: the SBA 7(a) loan and the SBA Express loan. The SBA 7(a) loan is a general purpose loan that can be used for a variety of business needs, including working capital, equipment purchases, and real estate purchases. The SBA Express loan is a smaller loan that can be used for working capital and other business needs. Both loans offer reduced fees for eligible veterans.
For more information on the SBA 7(a) loan, please visit https://www.sba7a.loans/sba-loan-comparison-chart. For more information on the SBA Express loan, please visit https://www.sbaexpress.loans/blog/sba-express-loans-for-veterans.
How do I apply for the SBA Veterans Advantage Program?
To apply for the SBA Veterans Advantage Program, you must first meet the eligibility requirements. You must be a veteran, active duty service member, reservist, or member of the National Guard, or the current spouse of a veteran, active duty service member, reservist, or member of the National Guard, or the widowed spouse of a veteran or service member who died during service or as a result of service-related disabilities. Your business must also be 51% owned by an eligible veteran.
Once you have met the eligibility requirements, you can apply for the SBA Veterans Advantage Program by visiting the SBA Express Loan Program website. On the website, you will find information about the program, including eligibility requirements, loan terms, and application instructions.
You can also contact the SBA directly for more information about the program. The SBA can be reached at 1-800-827-5722 or by email at contact@sba.gov.
What are the benefits of the SBA Veterans Advantage Program?
The SBA Veterans Advantage Program offers a variety of benefits to veteran business owners. These include:
- Waived fees: The SBA waives all upfront loan guarantee fees for veterans participating in the program.
- Reduced paperwork: The SBA also reduces the amount of paperwork required for veterans participating in the program.
- Boots to Business: Boots to business is an entrepreneurship training program developed by the SBA, and functions as a part of the Department of Defense’s Transition Assistance Program (TAP). Boots to Business helps service members transitioning to civilian life gain the skills to intelligently evaluate business concepts, create an effective business plan, and learn about the SBA’s various loan programs.
- Office of Veteran’s Business Development: The Office of Veteran’s Business Development (OVBD), provides training, counseling and mentorship to veteran business owners, and provides policy recommendations to the SBA about how to make the SBA’s loan guarantee programs more available to veterans.
- Veterans’ Business Outreach Centers: 19 organizations have partnered with the SBA to create Veterans’ Business Outreach Centers, or VBOCs in areas around the U.S. VBOCs help veteran entrepreneurs by providing training, mentoring, counseling, and referrals, and many host classes for the Boots to Business program.
- Veteran Women Igniting the Spirit of Entrepreneurship: This program, also known as V-WISE, helps train female veterans in entrepreneurship and small business management. V-WISE includes three phases of training, including an online course, an in-person training event, and continuing mentorship from experienced women entrepreneurs.
How long does it take to get approved for the SBA Veterans Advantage Program?
The SBA Express Loan Program typically takes 36 hours or less to get approved. The SBA Express Loan Program is designed to provide quick turnaround times for small business owners. The SBA Express Loan Program offers loan amounts up to $350,000 with terms up to 7 years. The SBA Express Loan Program also offers competitive interest rates and fees.
For more information on the SBA Express Loan Program, please visit https://www.sbaexpress.loans/.
Benefits of the Veterans Advantage Program
For more information, feel free to reach out to one of our SBA loan specialists today!