The Bremer Bank Increases Lending to its Small Business Customers

The Bremer Bank recently announced plans to increase the availability of credit to its small-business customers, following the recent signing into law of the Small Business Jobs Act of 2010 by President Barack Obama. One of the most important aspects of the Small Business Jobs Act of 2010 with respect to increasing the availability of credit to small businesses is the fact that under the new act, the US Small Business Administration (SBA) now guarantees 80 percent of the commercial lender’s stake in SBA 504 loans granted, which effectively means that lenders are more likely to grant loans to small businesses.

Prior to the Small Business Jobs Act of 2010 being signed into law, commercial lenders were required to bear more of the loan risk of SBA 504 loans, which ultimately meant that they granted fewer loans to small businesses. Other benefits to small businesses that can be directly linked to the signing into law of the Small Business Jobs Act of 2010 include higher loan limits for both the SBA 504 loan program, the SBA 7(a) loan program, as well as for microloans. Many experts agree that the Small Business Jobs Act of 2010 will indeed benefit the US economy by helping small businesses throughout the US to prosper and in turn, create more jobs.