International Trade Loans

Agency: Small Business Administration

Program: International Trade Loans

Program Description: The International Trade Loan program is designed for businesses preparing to engage or are already engaged in international trade or are adversely affected by competition from imports. Proceeds of an SBA loan cannot be used: to finance floor plan needs; to purchase real estate where the participant has issued a forward commitment to the builder/developer, or where the real estate will be held primarily for investment purposes; to make payment to owners or pay delinquent withholding taxes; to pay existing debt unless it can be shown that the refinancing will benefit the small business and that the need to refinance is not indicative of imprudent management.

Eligibility: The applicant must establish that the loan will significantly expand or develop an export market, is currently adversely affected by import competition, will upgrade equipment or facilities to improve competitive position, or must be able to provide a business plan that reasonably projects export sales sufficient to cover the loan. Although most small businesses are eligible for SBA loans, some types of businesses are ineligible and a case-by-case determination must be made by the Agency. Eligibility is generally determined by four factors: type of business, size of business, use of loan funds, and special circumstances. The vast majority of businesses are eligible for financial assistance from the SBA. However, applicant businesses must operate for profit; be engaged in, or propose to do business in the United States or its possessions; have reasonable owner equity to invest; and, use all financial resources first including personal assets. It should be noted that some businesses are ineligible for financial assistance.

Funding Information: The SBA can guarantee as much as $1,250,000 in combined working-capital and facilities-and-equipment loans (the working-capital portion of the loan may be managed according to the provisions of the Export Working Capital Program). Loans for facilities or equipment can have maturities of up to 25 years. The working capital portion of a loan, under the Export Working Capital Program provisions has a maximum maturity of three years. Interest rates are negotiated with the lender and can be up to 2.25% over the prime rate. For those applicants that meet the SBA’s credit and eligibility standards, the Agency can guarantee up to 80% of loans of $100,000 and less, and up to 75% on loans above $100,000 (generally up to a maximum guaranty amount of $750,000). The guaranty fee is the same as for any standard 7(a) loan. The SBA places no fee restrictions on the lender for the standard asset-based line but will require full disclosure to ensure that reasonable. On all other CAPLines, the annual fee is restricted to 2% based on the outstanding balance.

Timelines: Applications are accepted year round.

Contact: Int www.sba.gov

Sacramento (916)498-6410 Fresno (209)487-5791

Glendale (818)552-3210 San Diego (619)557-7250

Santa Anna (714)550-7420 San Francisco (415)744-6820