Recently the credit freeze has had effects on every area of the economy, including small businesses. Small business owners and entrepreneurs, both those in the business and those who are trying to make a fresh start after losing their jobs, are out of money and energy. They are looking to the government for help.
With the formation of his stimulus package, President Barack Obama is clearly hoping that he will give the financial assistance needed to get small businesses to act in a way that will boost the failing economy. The president has assured Americans that he is going to make sure credit is given to entrepreneurs and business owners. His administration believes that small business is the key to the economic recovery as they create about 70% of new jobs each year.
The stimulus package, officially the American Recovery and Reinvestment Act of 2009, became law on Feb. 17, 2009. It involves spending $787 billion in incentives and tax cuts with the goal being to kick-start economic growth and create new jobs in the next three years.
Obama has shown that he is committed to small businesses, increasing the budget of the Small Business Administration by 100% and giving out over $6 billion in small business loans since the package went into effect. Recently it has been suggested that bailout funds earmarked for banks may be diverted to small businesses. This would surly signal a shift in focus.
Many of our clients, having read about the plan in the newspaper or having heard about it on the T.V., are ready to accept the government’s promise. Legal professionals will have to help them sort through the messages and find the facts in order to help evaluate the pros and cons of the U.S. government’s Financial Stability Plan.
By: Bryan Hendersen
By accessing women government grants for small business owners, those who want to make the leap from employee or stay at home mom to business owner can do so with limited financial risk. The government grant money that is available for women business owners is only becoming more and more popular, but with that comes more competition.
What’s important to note is that women government grants for small businesses are no longer only being offered by government agencies. Many private foundations and private interest groups are providing funding to help women business owners get off the ground running and pursue their dreams.
When searching for start up capital it is critical to cast a wide net and seek many alternative financing options. The most unusual organizations, people and places can help you get the money you need. Placing a bet on a new business seems to be a good investment, as it helps with community development and the success of women-owned businesses as a whole.
As you search for start up financing, take the time to access grant databases that provide access to the funding you need. Women government grant for your start up may be provided by your local and state government, but it’s the nonprofit groups and private foundations that can provide serious money and can be difficult to find without the appropriate resources.
Once you find women business grants that seem most applicable to you, be sure to thoroughly review the terms of the grants, the qualification requirements, and how you are allowed to spend the money. Some small business grants for women are strictly for payroll, while others may be used to purchase office space, equipment and furniture, or even source products for your retail store.
By: David Sklonic
One misconception about starting a small business is that the only way to receive small business financing is through a bank. Though the bank is a viable option, it is not the only option. Looking towards multiple sources of financing can get your small business the financing it needs. Alternative sources of financing can be used instead of, or in addition to a bank loan. Using multiple sources of financing can help a new or veteran business owner maximize his/her business’ working capital.
Listed below are a variety of small business financing sources, that small business owners can utilize when building, expanding and maintaining their businesses.
Small Business Administration
The small business administration was created to help small businesses get on their feet and remain on their feet. Their mission is “…to maintain and strengthen the Nation’s economy by enabling the establishment and viability of small businesses and by assisting in the economic recovery of communities after disasters.” So why not look to the SBA for assistance?
The most common SBA loan program is the basic 7(a) loan program. This program is specifically designed for small business owners who may not be eligible for business loans through normal lending channels. Other loan programs offered by the SBA include the 504 Program, which provides growing businesses with long-term, fixed-rate financing for major fixed assets, such as land and buildings, Micro-Loans that provide very small loan amounts for startup small businesses, with a maximum loan amount of $35,000. Disaster Recovery Loans, which can assist in the recovery of your business if it is involved in a disaster, and Special Purpose Loans, that can be used for any special purposes within your business.
Grants
Just like there are scholarships available for just about anything, if you do enough searching, you could find the small business grant that works for you and get free money to finance your business. Though the federal government does not offer grants to small business owners, there are numerous other grants available for small business owners. You can look to your own state to find free funding your small business. Every state has a state development agency, and many of these agencies offer small business grants, and/or information on where to find them.
Small Business Cash Advances
Though a small business cash advance is not plausible for startup businesses, it can be used after your business has been up and running for a period of time. A business cash advance can offer fast and easy-to-obtain money for your small business’ financial needs. With few requirements, even business owners with average or fairly below average credit scores can qualify to receive a business cash advance.
Financial Intermediaries
A financial intermediary is a person who specializes in finding funds for business owners. Once you’ve done all you can to find money for your business, try hiring a financial intermediary to find the funds that you may have overlooked.
You can decide to use the expertise of a financial intermediary in order to give yourself the time to work on other aspects of your business, or you can use them in combination with your own expertise; as the saying goes, two heads are better than one.
Financial intermediaries can also be used to help in the start up of your business, offering help with the writing of business plans, proposals, etc.
By: Gaston Castro
Between the government and private foundations, there is over $500 billion in small business grant money available every year, and a big part of these funds go unclaimed. This is cash that you can obtain to help finance your start up costs or expand your current business, and because small business grant funds are not loans, you will never have to pay this money back. Even if your business fails.
The government provides small business grant money as a way to produce more tax income. The more successful your business is, the more jobs it creates, the more people spend on your product or service, and the more money your business will spend. Those are all good things for the economy and things that will bring in tax income for years to come. For that reason alone, small business grants are a good investment for the government if you can show a business plan that interests them.
Because there are a number of government agencies and private grant programs that will provide qualified applicants with small business grant money, the terms of each individual program slightly differ. Some will allow you to spend the cash you receive to purchase real estate, office furniture, or new computer equipment. Others may have stricter guidelines and only to be used to hire employees, provide professional development, or do business cross borders.
Whatever the case, there are a number of government and privately sponsored grant programs for new and existing small business owners. These funds can help those with an entrepreneurial mind take their dream and make it a reality, and the greatest benefit is that you never have to pay grant money back.
By: Austin Warty
As your wallet gets thinner in these financially rocky times, you may start thinking about ways to get money that you’d have never considered before. One of the coveted but sometimes overlooked methods of grabbing some spare cash is through government grants for individuals – not companies or teams of scientists, but regular people like you and me. But too many people don’t even know what a government grant is!
A grant is simply money donated by the government for a specific purpose. There are an almost limitless number of programs designed to grease the wheels of this system and get money to worthwhile causes, programs for everything from getting out of debt to repairing your automobile. The biggest checks, though, are generally ones for small business owners just starting out, because a healthy economy is so vital to the country and because America takes so much pride in its small businesses. Even being homebound isn’t necessarily a disadvantage, you can potentially still get checks of up to fifty thousand dollars!
Once granted the money, you don’t have to pay it back. Ever. That’s the difference between a grant and a loan. No interest, no hidden fees… if you find those things involved, then it’s not a real government grant. However, it’s top priority for you to use the money for the reasons you stated it was for in the first place. Don’t think you can pull a fast one over ol’ Sam and get money ‘to help orphans’ and then spend it all on potato chips and beer! Even apart from the moral issues involved, it’s not worth the penalties if you get caught. Don’t screw yourself over, be honest.
You have to be an American citizen to apply for a grant – it’s kind of one of the insular perks of really ‘belonging’ to the country. You also, and this may seem obvious, have to be eighteen. Sorry kids! Try hunting down a good database and searching through it for any general programs you could potentially make it with. The process isn’t necessarily as legendarily sow as typical government bureaucracy – if you’re lucky, you can be cashing those checks in as little as a week. Be sure to act while the time is ripe! Although grants have been a longstanding tradition in America, no one has any way of knowing when individual programs will have their plugs pulled.
Don’t wallow in despair and cynicism over the government during times like these. Now more than ever, you need to have faith that the system isn’t wholly broken. Why not try out some government grants for individuals yourself and see if some of them work for you? You have nothing to lose, and plenty of green to gain.
By: Adam Hefner
When considering business financing, small business owners typically consider three options: personal savings, retained business earnings, and bank loans. Once approached with a question of using grants to finance business ventures many say that they have not though of those at all. Surprisingly, many people categorize grants as a funding source for nonprofits and charities, but not for businesses. Many get surprised that there is grant money available from government, nonprofit organizations, and various foundations.
Considering grants as a part of business financing is a smart idea for business owners and managers. To stimulate growth in post-recession times U.S. Government is allocating a record amount of money to be deemed by businesses in form of grants. It is simply too good of a deal to let it pass by. There is typic ally a lot of confusion and misunderstanding among small business owners when it comes to grants. Most erroneously think that their business would not qualify since it is too traditional or if it makes money. This is not true at all. Grant money for small business may be claimed regardless of your business structure, industry, or income.
With thousands of grants available from federal and state government there are good chances for many businesses to get the funding they need. While some grants are very specific and restrictive in nature, aimed to finance specific projects in underdeveloped industries, the other ones are available to claim by virtually any small business. When considering grants, it is always better to search the ones designed specifically for your field of operation first, since such feature a better chance of approval. Should industry-specific financial assistance be unavailable, there are thousands of programs designed for small businesses in general.
Many applicants make a mistake of applying for only one grant, or for too many grants, at the same time. It is always a good idea to perform due diligence and pick several programs you think you have the best shot at. Do not get discouraged by the amount of paperwork to do. While every program is case-specific and unique, all of them share common application procedures and documentation requirements. Therefore, about 80% of the paperwork required would be the same for all small business grants.
By: Mary L. Thompson
Small Business Lenders are certified by the U.S. Small Business Administration to provide guaranteed funding to small business owners. Due to the diversity of applicants and the different business types, the SBA partners with their lending partners to make it easier for small businesses to obtain funding for new start-ups. Their involvement has allowed small business owners to obtain loans for a longer term and thus reduce the monthly repayments incurred. This provides businesses with a longer period of time to mature and stabilize without having to bear the heavy burden of a large loan repayment amount.
With this, the SBA has appointed a list of a few thousand lending partners in every state to extend this facility to the general public. Of course, borrowers are still required to submit full-fledge loan application proposals to the lender with the difference being that the SBA is the guarantor for such loans. This typically means that if the borrower defaults than the risk of non-repayment will fall upon the SBA, as they will then be responsible for repaying the loan.
Additionally, the criteria set forth for small business loans make 90% of all businesses qualified applicants for these loans. Apart from that, businesses are not burdened with balloon payments and high interest rates, which would otherwise be offered by any other commercial lender. Furthermore, fixed rate loans and variable loans are available to business owners. Therefore, business owners have more options in deciding the type of loan that would be suited for their business.
The purposes of acquiring a small business loan are varied according to the situation of the business. Small business owners may obtain loans to purchase real estate for business expansion purposes, to provide cash flow to support a large project, to lease machinery to operate a business, to utilize as working capital or to purchase inventory. Whatever the reason may be, business loans are evaluated an approved by these micro lenders after thorough evaluation of the business background, viability and purpose. The only difference is that through the support of the SBA, they are more willing to give out loans, as their risk is minimal with repayments guaranteed by a government agency.
By: Matt Bacak
Unemployment is up and large corporations are cutting back and some are even closing their doors for good. But through this sea of scattered dead companies, small businesses are popping up in every town and many entrepreneurs are in search for the government grants for small business owners.
It is no secret that a lot of people have lost their jobs and have been forced to make some life altering decisions about whether or not they want to work for someone else or work for themselves. And many have decided to be their own boss and launch their own business. While this can be an exciting time for an entrepreneur, it can also be somewhat scary. After all, starting a business takes a lot of time and money if you want to do it right. And who doesn’t. After all, if you are starting your own business, then you certainly want to be a success. And being able to obtain some government grants for small business owners will help ease process.
But if you want to have a chance at getting a grant for new small business, then here are three tips that may help make the application process a little bit smoother.
Information in your grant application needs to be accurate and complete. Failure to do so could result in a delay of your grant approval or even your application not even making it to the review process. Have a well-prepared business plan so you do not blend in with the crowd. Show them your understanding of the business and how the money will provide the benefit they want. Add an outside expert to your panel of experts. This may help add credibility to you and your business.
By following these three simple steps, you may be able to increase the chances of getting government grants for small business owners.
By: Zak Crawford
Within the last decade, the amount of small businesses around the world has increased greatly. Many people have started their own small businesses due to the lack of work and jobs in some areas and some people have started their own businesses because it has always been their dream.
For whatever reason a person has to start their own business, they will likely need a small business loan at some point to help them with various costs that are associated with running a personal business.
Traditionally, people sought after larger financial institutions for their small business loan needs, but these days the larger banks are not doing as well as they once were. Independent lenders are now the preferred option of many small business owners when they need a small business loan.
In all reality, there is virtually no person that has not been effected by the banking crisis in some way. Whether you use banks or not, you will be effected. Since this crisis has began, the value of the pound in the UK has been declining, even more so than the American dollar and Japanese Yen.
However, the American dollar and the Japanese Yen have both dropped in value as well as many other currencies. Peoples’ net worth and savings have been in decline also since the banks have been in trouble. Larger banks and financial institutions have stopped lending to one another and to many people.
The banks have not trust amongst each other now and are approving as many loans as they once were. In fact, many of the larger banks have become so strict with their loan policies that they will not approve loans to people that do not have the best credit ratings. Banks have quickly become risk averse.
Before the crisis, the banks were handing out loans to pretty much anyone who applied. Now that the banks are in serious trouble, they are forcing people to accept higher interest rates than ever before, even for those who have great credit.
It seems that anyone who needs a small business loan or many other types of loans should greatly consider independent lenders over the larger banks and financial institutions. Independent lenders are now the leaders for the best loan option.
These lenders are not troubled with this crisis in the same way that the banks are and can give loans out to people with fair interest rates, even to those people who do not have the best credit. There are many different independent lenders to choose from and many of them can be accessed online.
By: Ken Barnes
The fact that minority groups only own eight point five percent of the small businesses in the country as noted by Congressman Mike Honda of California is a trouble fact. Mike Honda is the Chair of the Pacific-Islander Caucus within the United States Congress. Honda has tried to work hard to expand government grants and loans to average people around the country. Mike Honda believes everyone should get a shot at the American dream. If the entire state of California were to find some good grant finding software, this could greatly decrease the unemployment rate there. If we want more minorities to have a shot at owning a small business we are going to need many women stepping up and attempting to start their own small business.
Truthfully there are government grants out there to start a small business and programs through the Small Business Administration, but the truth is that the cottage industry of grant writing is also quite crucial to the growth of the economy. It is possible that philanthropists who have deep ties within the government such as the Rockefeller family who could do plenty as far as finding grants that women need to open up their own dining establishment.
The Heinz Foundation is another source to help you find government grants due to their government connections given that the Chairwoman of the Foundation is married to John Kerry, but the truth is that software that will help you find a grant would likely be more beneficial. The grant software can help you pinpoint the exact grant that meets the specifications that you need in order to find success. You can always consult the instructions that the software offers if you are having trouble working your way around the software.
By: H. Milla