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SBA Loans for Veterans: Loans, Training & Contracts

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SBA Loans for Veterans: Loans, Training & Contracts

Updated: June 4th, 2021

SBA Loans for Veterans: Loans, Training and Contracts

Veterans do more for our country than protect our borders and our freedom (as if that wasn’t enough already)—it turns out they play a critical role in our economy. More than 10% of veterans are self-employed business owners, employing over 5.8 million individuals.

However, like for most American entrepreneurs, getting access to capital isn’t easy. It takes money to make money, especially when starting a brand-new business or financing expensive ongoing costs.

The Small Business Administration (SBA) used to provide various loan programs to provide veterans with financial assistance. However, those programs are no longer in existence:

  • SBA Patriot Express Loan: Patriot Express loans provided veterans and active-duty military members loans up to $500,000 for their small businesses. The application was less paperwork heavy and waived fees to reduce the financial strain on borrowers. The program was discontinued in 2013.
  • SBA Veterans Advantage Guaranteed Loans: This loan operated as part of the SBA 7(a) program, granting veterans reduced guarantee fees on their standard SBA 7(a), Express Loans, and Microloans. The program ended in 2018, and the SBA has not made it clear whether they still offer (or plan to offer) these loans.

While these veteran-specific programs are no longer in operation, the SBA still provides a couple of funding programs, training, and contracting opportunities to veterans:

  • SBA Loans
  • The Military Reservist Economic Injury Disaster Loan Program (MREIDL)
  • Office of Veterans Business Development (OVBD)
  • Boots to Business
  • Women Veteran Entrepreneurship Training Program (WVETP)
  • Service Disabled Veteran Entrepreneurship Training Program (SDVETP)
  • Veteran Federal Procurement Entrepreneurship Training Program (VFPETP)
  • Service-Disabled Veteran-Owned Small Business Concern Program (SDVOSBC)

We cover all the details of these funding programs, training, and contracting opportunities below:

SBA Loans

SBA 7(a) Loans

While veterans don’t get any special discounts or waived guarantee fees, SBA 7(a) loans are still a great financing option for funding your business. You can use your 7(a) loan proceeds on just about any business purpose, and they often come with the lowest interest rates and most flexible repayments terms on the market.

Apply for an SBA 7(a) loan with Funding Circle to secure a loan from $25k to $500k with a flat 6% interest rate and loan terms up to 10 years. Start your application now by taking 6 minutes to answer a few questions.

SBA Microloans

SBA microloans function much the same way as standard 7(a) loans, except for they have smaller loan amounts and can’t be used on real estate purchases or debt consolidation. Microloans usually have a $50,000 maximum and interest rates between 8% to 13%.

SBA 504 Loans

SBA 504 loans provide long-term, fixed-rate financing for loans up to $5 million. These loan proceeds can be used on fixed assets that boost job creation and business growth. Certified Development Companies (CDCs), SBA’s community-based partners, offer SBA 504 loans.

The Military Reservist Economic Injury Disaster Loan Program (MREIDL)

The SBA’s MREIDL program provides loans up to $2 million to help cover operating costs that can’t be met because an essential employee was called to activity duty in the Reserves or National Guard. These loans have a 4% interest rate and up to 30-year repayment terms.

Loan proceeds can be used to cover ordinary and necessary operating expenses. You’ll need to provide collateral for any MREIDL loans greater than $50,000, but the SBA won’t decline your loan application if you don’t have sufficient assets.

Additional veteran business owner resources

Office of Veterans Business Development (OVBD)

The OVBD facilitates all veteran SBA loans and programs. OVBD provides Veterans Business Outreach Centers (VBOC) across the country to offer in-person workshops, mentorship, training, and more for eligible veterans.

Find your nearest VBOC here.

Boots to Business

Boot to Business is an SBA entrepreneurial program designed to provide an overview of entrepreneurship and applicable business ownership fundamentals. There’s a variety of programs offering education to activity-duty service members and their spouses, as well as veterans of all eras.

Women Veteran Entrepreneurship Training Program (WVETP)

The WVETP provides entrepreneurial training to women veterans, women service members, and spouses of service members and veterans. The SBA funds these training programs through the Veteran Women Igniting the Spirit of Entrepreneurship (V-WISE) and Lift Fund.

Service Disabled Veteran Entrepreneurship Training Program (SDVETP)

The SDVETP is a training grant offered to service-disabled veterans who aspire to be small business owners or currently own a small business. 

Veteran Federal Procurement Entrepreneurship Training Program (VFPETP)

The VFPETP provides entrepreneurship training to veterans and service-disabled business owners who are pursuing federal procurement.

Service-Disabled Veteran-Owned Small Business Concern Program (SDVOSBC)

The SDVOSBC aims to set aside at least 3% of federal contracting dollars to service-disabled veteran-owned small businesses every year. The federal government limits competition for these specific contracts to help eligible veterans.

FAQs
VA loans were the name for the discounted SBA loans provided through the Veterans Advantage lending program. VA loans reduced guarantee fees for veteran-owned businesses, helping to make the financing more affordable. It’s since been discontinued, and these loans are no longer available.
Veterans can apply for small business loans, lines of credit, merchant cash advances, and more forms of financing through banks, credit unions, and alternative lenders. Some lenders offer special financing to veterans that has nothing to do with the SBA loan program. They might provide loans exclusively for veterans or lower restrictive loan requirements to help veterans qualify. Lenders understand veterans might not have as much time in business, but they realize their leadership skills, commitment, and work ethic make them less risky borrowers.
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