SBA announces all-new program for helping dealers with the floorplan financing

Posted on Friday, 29 May 2009 , 13:05:47 byEmil

Filed under sbanewprogramhelpdealerfinanceusau.s.americaNone

SBA announces all-new program for helping dealers with the floorplan financing

Car financing dried up for dealers and clients alike, but the SBA (Small Business Administration) announced a brand new program to help the latter. The Small Business Administration announced Thursday a brand new government program for aiding dealers to secure the floorplan financing there.

The pilot program debuts on 1st of July running through 30th of September next year. The SBA could be extending the program if necessary. 'Countless small businesses, including dealerships across the country face significant challenges as a result of the uncertainty in the auto industry' Karen Mills - SBA Administrator stated. 'Floorplan financing can offer some dealerships the opportunity to get through these tough economic times by allowing them to keep their inventory and cash flow intact'.

Automotive News said the SBA will be guaranteeing 4,500 loans in the first 3 months of this program. In the upcoming year, the Small Business Administration will guarantee around 7,500 loans. So, under the contract terms, the government in the U.S. will be guaranteeing up to 75 % loans between 500,000 Dollars and 2 million Dollars, with a top repayment five years term.