Business loans can be hard to come by in today’s economy, and sometimes returning veterans do not have the bank contacts that they need to get approval of such loans. In addition, veterans can return to the U.S. with unmet financial needs that can result in a splurge of spending and a subsequent lowering of their credit score.
Differenece Between Veterans and Regulars
Fortunately, programs exist to help veterans to reintegrate into American life. Business loans for veterans with bad credit are not impossible to find, although the same rules apply to vets that apply to other consumers. The difference is that some lending programs have been expressly created for veterans, increasing the chances of a sympathetic ear as s/he tries to get an enterprise off the ground.
The Patriot Express Program
Business loans for vets with bad credit can be garnered through just about any bank or credit union that gives business loans to other people, but the Small Business Administration’s (SBA) Patriot Express Program is a particular favorite.
Through the Patriot Express Program, vets can find more attractive interest rates from lenders pre-disposed to help them. The program offers guarantees to lenders once a loan is approved, which makes the lender more amenable to a vet’s business plan. The SBA, with the backing of the U.S. Government, will guarantee up to 85% for loans of less than $150,000 and up to 75% for loans above that amount.
Business Loan Amounts
Vets looking for a business loan can apply for up to $500,000 — a nice start-up package. The interest rates average 2.25% -4.75% above the prime, a low for SBA loan programs. Applicants must be veterans of the U.S. Army, Navy, Air Force or Marine Corps and can include those disabled during their military service.
The Patriot Express Program is also open to active military personnel who qualify for the military’s Transition Assistance Program, as well members of the National Guard and reservists. Spouses of any of the above positions are also eligible, as are widowed spouses of U.S. military personnel who died in active service or due to service-related causes.
The one prerequisite that might hinder those seeking business loans for veterans with bad credit is the 20% guarantee of funds that the applicant wishes to borrow. That can be in the form of business collateral and personal assets. So, a veteran needs to come to the table with at least something to offer to the participating lending institutions.
Many veterans have found help through this program, and more than a few have been able to start successful businesses that serve as contractors to the military. These vets draw on their given expertise in the military to continue to aid our armed forces in the role of a contractor. The Patriot Express Program can make it happen for you.