In October 2008, Congress enacted the Emergency Economic Stabilization Act (EESA) to respond to instability in U.S. financial markets, caused particularly by institutions' being saddled by delinquent mortgages. This same legislation created the Troubled Asset Relief Program (TARP).

To address the problem, Congress authorized the U.S. Treasury to spend $700 billion to stabilize the economy through TARP. The first $350 billion was released last fall. Before the second $350 billion is released, Congress is developing legislation that would inject oversight of the way TARP funds are used, including strict restraints on corporate pay.

Early April 2009, President Obama announced a plan to inject $15 billion into the small-business loan market. The $15 billion, coming from the U.S. Treasury Department, will be used to purchase securities backed by the SBA-guaranteed loans in an attempt to jump-start the secondary credit market for small businesses. Banks that offer SBA-guaranteed loans have hit a lending wall in recent months, as the secondary market is frozen, so banks can't get the old loans off their balance sheets to free up capital for new loans. According to President Obama’s plan, the SBA will raise the portion of each 7a loan that it guarantees from 75% to 90%, making it more attractive for banks to participate in SBA lending, thereby creating more loan opportunities for businesses.

Our economy has experienced its ups and downs, and there are now programs available from financial institutions, and local community banks that are interested in your business through vehicles known as SBA Guaranteed Loans.

Below are some local banks, and their lending services that are being offered for commercial real estate business:

“Androscoggin Bank provides commercial lending services from its 121 Middle Street, Portland location and from its twelve branch locations across Maine. Most importantly, Androscoggin Bank offers local decision making, competitive rates, $11 million loan capacity, and creative financing structure solutions such as:

 

SBA 504 with up to 90% LTV programs available for properties 50% occupied by an owner/operator.  The SBA 504 is now available for re-finance.

 

SBA 7A loans with up to 90% loan guarantees for operating businesses with origination fees waived during current economic stimulus programs.

 

USDA guaranteed programs including its Direct Community Facility Program wherein the bank partners with USDA.  Amortization for direct USDA programs can extend to 40 years with very competitive rates.  90% guaranty available on bank financing.  Portland locations are ineligible.

 

Additionally, Androscoggin Bank has excellent relations with AVCOG, Biddeford Saco Economic Development, FAME, City of Portland & CEI in arranging subordinate financing where appropriate.

 

Residential Development loans require significant equity contribution and outside sources of income to carry interest during the project sales period.

 

Please call Tim Michalak at 207-553-2112 to discuss any financing needs.”

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