Posted byon May 19, 2009
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The Recovery and Reinvestment Act of 2009 included some terrific financing opportunities for small businesses. The SBA ARC Loan Program offers 0% loans to small businesses for up to five years.
The program caught my eye, because it looks like a fantastic arbitrage opportunity!
The loan program offers loans to small businesses 100% backed by the small business administration. The idea is to help businesses experiencing hardship, which includes declining revenues; common for many small businesses right now. The loans are structured as follows:
Loan Terms. Loans up to $35,000, at 0% with no fees. No collateral is needed.
Repayment. The loan money is distributed over 6 months. Repayment begins one year after the last distribution and can last up to five years.
Time Frame. The loans will be offered until September 30, 2010. It will end sooner if all the funding is used before then.
To qualify for the ARC loan, businesses must meet the following criteria:
You’ll need some current business debts to qualify, which can include credit card obligations. Since we’ve used business cards to super-size our credit card arbitrage in the past, we’ll have plenty of “business debt” to show.
Our business will hit the 2 year mark later this year, so I’m planning to submit an application. Because I’m taking time off this summer, I’ll have no problem showing a decrease in revenue!
What a fantastic way to convert some 0% balance transfer money into five years at 0%!