 News Release PRESS OFFICE Release Date: May 18, 2009 | Contact: David J. Hall (202) 205-6697 | Release Number: 09-30 | Internet Address: http://www.sba.gov/news | SBA Launches New 100-Percent Guarantee ARC Loan Program to Help Struggling Businesses WASHINGTON– Small businesses suffering financial hardship as a result of the sloweconomy may be eligible to receive temporary relief to keep their doorsopen and get their cash flow back on track through to a new loanprogram announced today by SBA Administrator Karen G. Mills. Beginning on June 15, SBA will start guaranteeing America’s RecoveryCapital (ARC) loans. ARC loans are deferred-payment loans of up to$35,000 available to established, viable, for-profit small businessesthat need short-term help to make their principal and interest paymentson existing qualifying debt. ARC loans are interest-free to theborrower, 100 percent guaranteed by the SBA, and have no SBA feesassociated with them. “These ARC loans can provide the critical capital and support manysmall businesses need to make it through these tough economic times,”said Administrator Mills. “Together with other provisions of theRecovery Act, ARC loans will free up capital and put more money in thehands of small business owners when they need it the most. This willhelp viable small businesses continue to grow and thrive and create newjobs in communities across the country.” As part of the Recovery Act, the ARC program was created as ano-interest, deferred payment loan to help small businesses that have ahistory of good performance, but as a result of the tough economy, arestruggling to make debt payments. ARC loans will be disbursed within a period of up to six months andwill provide funds to be used for payments of principal and interestfor existing, qualifying small business debt including mortgages, termand revolving lines of credit, capital leases, credit card obligationsand notes payable to vendors, suppliers and utilities. Repayment willnot begin until 12 months after the final disbursement. Borrowers don’thave to pay interest on ARC loans. After the 12-moth deferral period,borrowers will pay back the loan principal over a period of five years. ARC loans will be made by commercial lenders, not SBA directly. For more information on ARC loans, visit http://www.sba.gov/recovery/arcloanprogram/index.html You can receive all of the SBA’s News Releases via email. To subscribe,visit http://web.sba.gov/list and select “Press Office.
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