TANSTAFL

I've been pursuing the elusive SBA ARC loan that I mentioned in a previous post. This is the economic stimulus package loan that offers small businesses a relatively small loan at great terms. It's got a 0% interest rate, a full year before payments are due, and it's secured by the government. Unfortunately, there's so little incentive for banks, and communication has been so poor between the SBA and financial institutions, that my efforts haven't gotten me anywhere.

My own bank hadn't heard of it when I called, even though the ARC loan goes into effect in three weeks. The branch I called was on the short list of SBA banks who specialize in SBA loans. The branch manager spent a good amount of time on the phone with me trying to piece together exactly what the thing is. When she got back to me later, her version of the loan didn't match the SBA version, telling me there's still poor communication or banks are free to use this as a starting point.

Still, as the manager pointed out, there's no way they would be involved in a 0% loan. In fact, because of the SBA heavy paper load, they would want to get reimbursed at least 4% or more to make it worthwhile. Step one for anyone wanting an ARC loan seems to be finding a bank that's at least willing to participate. That will probably involve waiting until the plan is better communicated by the SBA. What's likely to happen is that the ARC loan will share the fate with the housing rescue plan, the one that was supposed to help hundreds of thousands but had half a dozen applicants due to the strict restrictions and complexity of applying.