$0 to 250000
Use of Funds:
SBA Export Express helps small businesses develop or expand their export markets. The program provides exporters and lenders a streamlined method to obtain SBA-backed financing for loans and lines of credit up to $250,000.
Most banks in the U.S. do not lend against export orders, export receivables or letters of credit. SBA temporarily provides lenders with up to a 90 percent guaranty on export loans as a credit enhancement to encourage participating banks to make loans that make the necessary export financing available.
Lenders use their own credit decision process and loan documentation. SBA provides an expedited eligibility review and provides a response in less than 24 hours, so exporters get access to funds faster.
How Funds May Be Used
Loan proceeds may be used to finance any export development activity, including:
SBA Export Express loans are available to businesses that meet the normal requirements for an SBA 7(a) business loan guaranty. Financing is available for manufacturers, wholesalers, export trading companies and service exporters. Loan applicants must demonstrate that the loan proceeds will enable them to enter a new export market or expand an existing export market. Applicants must have been in business, though not necessarily in exporting, for at least 12 months.
The maximum line of credit/loan amount is $250,000. The Recovery Act temporarily provides up to a 90 percent guaranty on Export Express loans. It is anticipated this increased guaranty will last through the end of calendar year 2009, or until the appropriated funds are exhausted, whichever comes first. Normally, the lender receives an 85 percent guaranty for loan amounts up to $150,000 and 75 percent on loan amounts between $150,000 and $250,000.
The maturity of an SBA Export Express term loan is usually 5 to 10 years for working capital, 10 to 15 years for machinery and equipment (not to exceed the useful life of the equipment), and up to 25 years for real estate. The maturity for revolving lines of credit may not exceed 7 years.
The SBA does not establish or subsidize interest rates on loans. Interest rates are negotiated between the borrower and the lender, but may never exceed SBA interest rate caps. Rates can either be fixed or variable, and are tied to the prime rate as published in The Wall Street Journal, the one-month LIBOR rate, or the optional peg rate published quarterly in the Federal Register.
The SBA fee for an Export Express loan with a 12-month maturity or less is ¼ percent (0.25 percent) assessed on the guaranteed portion of the loan. For loan maturities longer than 12 months, the normal guaranty fee is 2 percent on loans up to $150,000 and 3 percent on loans between $150,000 and $250,000. However, the Recovery Act temporarily provides for a guaranty fee elimination on all 7(a) and 504 loans. It is anticipated this elimination will last through calendar year 2009 or until the appropriated funds for this provision are exhausted, whichever comes first.
Lenders follow collateral policies and procedures that the lender has established for its non-SBA-guaranteed loans.
Because many small business exporters face unique problems and challenges, the SBA Export Express Program also includes technical assistance in the form of marketing, management and planning assistance. SBA’s U.S. Export Assistance Centers provide technical assistance in cooperation with SBA’s network of resource partners, including Small Business Development Centers (SBDCs) and Service Corps of Retired Executives (SCORE).
On approval of an SBA Export Express loan, a U.S. Export Assistance Center representative will contact the borrower to offer appropriate assistance, which may include training through the SBA’s Export Trade Assistance Partnership, SBDC International Trade Center, SCORE, District Export Council, or Export Legal Assistance Network.
How to Apply
Application is made directly to the lender. Lenders use their own application materials in addition to SBA’s Borrower Information Form.
Lenders approve the request and then submit a limited amount of eligibility information to SBA’s National Loan Processing Center. The SBA provides a response within 24 hours.
Interested businesses should contact their existing lender to determine if it is an SBAExpress lender. Lenders that participate in the SBAExpress program are also able to make Export Express loans.
For More Information
SBA staff can help in weighing financing options and risk mitigation, plus advise on SBA loan products and application procedures. Contact your local U.S. Export Assistance Center to learn more about the Export Express Program and whether your business might qualify.
BBVA Compass Bank
California Bank & Trust
First Community Bank
JP Morgan Chase fka Bank One
Liquid Capital of Colorado
Wilshire State Bank