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VA Small Business Loans

By Edited Oct 24, 2016 0 1

If you are a veteran who is searching for a loan to start up a small business, you will be happy to hear that The Department of Veteran Affairs Vocational Rehabilitation and Employment Service (VR&E) is providing assistance to qualified disabled veterans who participate in a VR&E program by joining forces with the Small Business Administration (SBA) and the Association of Small Business Development Centers (SBDC).

It is thanks to the Veterans Entrepreneurship and Small Business Development Act of 1999 that this partnership has come to be. This partnership focuses on supporting qualified veterans who are looking into owning a business or expanding a current business.

When you go to a bank for a small business loan, they are going to closely review your application and all of the supporting documentation that you have provided. If for some reason you cannot qualify for a regular small business loan based on your application, the bank will then recheck the application using the SBA guidelines to see if you will then qualify.

If you meet the SBA criteria, then the small business loan that the bank will offer you is one that is guaranteed by the SBA, which as agency of the federal government. What this means is that if something happens and the business owner defaults on the loan, the bank will be paid some of what it is owed by the SBA to help offset the loss. Preference is given by the SBA to those veterans who are trying to obtain assistance for their small business.

To be considered qualified, you must be a service connected disabled veteran who is entitled to be a member of a VR&E program. Self-employment must be the most viable option for you to become employed in a suitable profession.

As the participant in the program researches the feasibility of their desired business, puts together a business plan and demonstrates the feasibility of the plan, they are offered guidance through the SBDC, SBA, and VR&E. How much assistance is offered will depend upon the severity of the service connected disability/ies and the case manager provided by the VR&E. Rehabilitation through self-employment is the main goal of this particular program.

Small business loans are NOT offered through the Department of Veteran Affairs. Veterans may be able to qualify for small business loans through the Small Business Administration.

By getting the loan through the VR&E Service, the qualified service connected disabled veteran is assured of guidance as they go through the process of researching their proposed business and gathering the required documentation to ensure approval of their business plan. When applying for a business loan, keep in mind the various items that the financial institution is going to be looking at -- offered collateral, personal financial statements, explanation of how the loan funds are going to be used, a business profile and any business financial statements.

Keep in mind that small business loans are generally required to be repaid over 5 to 7 years.

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Comments

May 2, 2010 8:46am
kp3028
Very interesting to know.
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