As of June 28, 2007, the SBA 7(a) Loan Program (the most common and popular program offered by the SBA) offered the Patriot Express Loan. Like most loans, there was no absolute guarantee of approval, but the goal of the Patriot Express Loan was to speed up military veterans’ access to business capit
In this article:As of June 28, 2007, the SBA 7(a) Loan Program (the most common and popular program offered by the SBA) offered the Patriot Express Loan. Like most loans, there was no absolute guarantee of approval, but the goal of the Patriot Express Loan was to speed up military veterans’ access to business capital. They offered one of the SBA’s fastest turnaround times for loan approvals. The Patriot Express Loan Program was based on, and enhanced the guarantee and interest rates of, the already successful SBA Express Loan Program.
In order to qualify, a veteran needed to own the majority of his or her business. They also needed to be on active duty (and in the Transition Assistance Program), in the National Guard, service disabled, or a reservist. Spouses of the above, as well as widowed spouses of those who passed away in service were also eligible. Dishonorable discharge was a deal-breaker.
The Patriot Express Loan allowed military business owners both term loans and lines of credit for financing up to $500,000. That money could be used for startup costs, or to purchase business inventory or commercial real estate. Debt refinancing was also an option.
The main benefits of the Patriot Express Loan were:
The SBA Patriot Express Loan Program streamlined the loan application and approval processes. It was possible for Veterans to get approved for financing in as little as 36 hours. Veterans could apply for loans up to $500,000 and get a low interest rate with as little as zero fees. While the guarantee fee started out at 3% for loans between $150,001 and $350,000, that fee was later reduced to 0%.
On December 31, 2013, the Patriot Express Loan Program ended after more than six years of providing opportunity for active service members, military spouses, and veterans.
In 2013, the GAO (Government Accountability Office) recommended that the “SBA Should Evaluate the Program and Enhance Eligibility Controls.” The GAO found that, except for the loans approved in 2007 (the pilot year of the program), loans approved under the Patriot Express Loan Program defaulted at a much higher rate than regular SBA 7(a) loans or even SBA Express Loans. The overall default rate for Patriot Express Loans was especially high for loans less than $25,000. Another red flag was that the SBA couldn’t confirm all borrowers’ continuing eligibility once the loan was approved.
There are a number of resources still available for business-minded veterans who are looking for funding for their dreams.
The SBA Express Loan Program gives veterans access to as much as $500,000 in as little as 36 hours (similar to the old Patriot Express Loan), if approved. Neither is there any upfront fee to the borrower for all approved loans up to $500,000. When the loans are less expensive for the borrower, more veterans are likely to apply for capital to go into business. Since 2009, SBA has nearly doubled its lending support to veteran-owned businesses.
A veteran-owned and run online auction marketplace which connects veteran entrepreneurs looking for financing with investors wanting to fund small businesses. StreetShares has a fast and easy approval process, and strongly emphasizes support for veteran-owned businesses.
The SDVOSBC exclusively helps veterans secure a certain number of government contracts, especially if you were injured in service.
According to the UPS website, “Veterans are uniquely suited for solving the nation’s most pressing challenges and this makes them incredible entrepreneurs.” So UPS offers veterans looking to open a UPS franchise a $10,000 franchise fee discount as well as a 50-75% initial application fee discount.
If you graduated from a U.S. military academy, Hivers and Strivers provides funding for startups run by academy graduates. This angel investment group focuses on supporting West Point, Annapolis, Air Force, and Coast Guard graduates.
If you’re a veteran within one year of being released from active service, and your business was affected when you were called into active duty, you may want to check your eligibility for a low-interest Military Reservist Economic Injury Disaster Loan. Some collateral may be required depending on the funding you’re looking for, and you’ll need to prove that your business can’t recover without government help, but it’s definitely an option to consider!
To learn more about the SBA 7(a) Loan and other business loan options for veterans, simply click the button below to connect with US Today!
The Patriot Express Loan Program was designed to provide financing to veterans, active service members, and military spouses. To be eligible for the program, applicants had to meet the following criteria:
The SBA Patriot Express Loan Program offers a number of benefits to veterans looking for financing. These include:
The SBA Patriot Express Loan Program offered loans up to $500,000 with a low interest rate and as little as zero fees. The guarantee fee started out at 3% for loans between $150,001 and $350,000, but was later reduced to 0%.
The program ended on December 31, 2013. The Government Accountability Office (GAO) found that, except for the loans approved in 2007 (the pilot year of the program), loans approved under the Patriot Express Loan Program defaulted at a much higher rate than regular SBA 7(a) loans or even SBA Express Loans. The overall default rate for Patriot Express Loans was especially high for loans less than $25,000.
The Patriot Express Loan Program was designed to make the loan application and approval process easier for veterans. To apply for the loan, you must first fill out the SBA Patriot Express Loan Application and submit it to an SBA-approved lender. You can find a list of approved lenders here. Once you have submitted your application, the lender will review it and contact you with the next steps.
In order to apply for the Patriot Express Loan, you will need to provide the following documents:
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