Harris Introduces New Initiative for Small Businesses: Simplifying Loan Regulations
The recent modifications implemented by the SBA are designed to reduce financing costs.
TroibNews 
The Biden administration is loosening restrictions on government-backed small business loans, with Vice President Kamala Harris emphasizing startup support as a key aspect of her presidential campaign.
In an announcement featuring Harris, the Small Business Administration (SBA) is modifying the terms of a program that allows businesses to refinance debt related to land, buildings, and equipment. The SBA anticipates that these adjustments, which follow a series of similar updates over the past few years, will simplify eligibility criteria for small businesses and potentially reduce their loan costs by thousands of dollars. The agency promotes small business loans to mitigate risks for banks and enhance access to financing.
“Today’s final rule and announcement build on our work to support entrepreneurs by cutting red tape and ensuring small businesses can access capital, refinance SBA loans and continue to hire workers in their local communities," Harris stated.
Throughout the Biden administration, Harris has been a prominent advocate for small business initiatives, including previous efforts to relax lending regulations that sparked a bipartisan outcry in Congress. On the campaign trail, she has committed to broadening tax deductions for startups to encourage 25 million new business applications by the end of her first term.
"The Biden-Harris administration at the SBA, throughout this entire administration, has really doubled down on simplification of our products for expansion purposes, to help more small businesses access the affordable capital that they need to really grow their businesses and launch their businesses," SBA Administrator Isabel Guzman remarked in an interview.
The SBA's recent announcement centers on the agency's "504" lending program, which assists loans tied to land, buildings, and equipment for businesses valued at less than $15 million. The revisions aim to enable businesses to utilize SBA refinancing options and decrease payments on current loans, regardless of whether they are SBA-backed. Modifications will increase the flexibility of loan usage and eliminate the requirement for borrowers to demonstrate a minimum reduction in payments for refinancing.
In the last year, the number of refinancing loans under the SBA 504 program reached 568, totaling nearly $761 million.
"It's an asset builder," Guzman asserted. "It's been the thing that powers strong expansion. And it also helps businesses with debt refi. But there have been challenges in the program that really have limited access for some businesses. So this is our opportunity to really expand a high-performing program for small businesses and reduce costs for them at a vital time when we want to see their continued growth and opportunities in this economy."
This emphasis on debt refinancing coincides with the Federal Reserve's decision to lower interest rates, which will decrease borrowing costs for businesses. The White House Council of Economic Advisers indicates that small employers are particularly poised to gain from these rate cuts, as many rely on bank financing and possess floating-rate loans.
Allen M Lee contributed to this report for TROIB News
In an announcement featuring Harris, the Small Business Administration (SBA) is modifying the terms of a program that allows businesses to refinance debt related to land, buildings, and equipment. The SBA anticipates that these adjustments, which follow a series of similar updates over the past few years, will simplify eligibility criteria for small businesses and potentially reduce their loan costs by thousands of dollars. The agency promotes small business loans to mitigate risks for banks and enhance access to financing.
“Today’s final rule and announcement build on our work to support entrepreneurs by cutting red tape and ensuring small businesses can access capital, refinance SBA loans and continue to hire workers in their local communities," Harris stated.
Throughout the Biden administration, Harris has been a prominent advocate for small business initiatives, including previous efforts to relax lending regulations that sparked a bipartisan outcry in Congress. On the campaign trail, she has committed to broadening tax deductions for startups to encourage 25 million new business applications by the end of her first term.
"The Biden-Harris administration at the SBA, throughout this entire administration, has really doubled down on simplification of our products for expansion purposes, to help more small businesses access the affordable capital that they need to really grow their businesses and launch their businesses," SBA Administrator Isabel Guzman remarked in an interview.
The SBA's recent announcement centers on the agency's "504" lending program, which assists loans tied to land, buildings, and equipment for businesses valued at less than $15 million. The revisions aim to enable businesses to utilize SBA refinancing options and decrease payments on current loans, regardless of whether they are SBA-backed. Modifications will increase the flexibility of loan usage and eliminate the requirement for borrowers to demonstrate a minimum reduction in payments for refinancing.
In the last year, the number of refinancing loans under the SBA 504 program reached 568, totaling nearly $761 million.
"It's an asset builder," Guzman asserted. "It's been the thing that powers strong expansion. And it also helps businesses with debt refi. But there have been challenges in the program that really have limited access for some businesses. So this is our opportunity to really expand a high-performing program for small businesses and reduce costs for them at a vital time when we want to see their continued growth and opportunities in this economy."
This emphasis on debt refinancing coincides with the Federal Reserve's decision to lower interest rates, which will decrease borrowing costs for businesses. The White House Council of Economic Advisers indicates that small employers are particularly poised to gain from these rate cuts, as many rely on bank financing and possess floating-rate loans.
Allen M Lee contributed to this report for TROIB News
