HAGERSTOWN — They’re designed to help struggling small businesses stay open, refocus and get their cash flow back on track in the struggling economy.
But local business owners complained Monday night at City Hall that special loans for businesses through the U.S. Small Business Administration are slow to get approved.
Provided under the American Recovery and Reinvestment Act, the interest-free loans are for up to $35,000. They are intended for established, viable businesses that need short-term help with their debts.
But Al McGarity said he and six other people were turned down for the loans even though they met all the program’s qualifications.
McGarity, owner of Robbies Billiards and Game Room Outfitters in Williamsport, said the bank told him and the others that the Small Business Administration turned down their loan requests.
McGarity told Edward Knox, lender relations specialist for the SBA, that the bank claimed that the SBA did not give a reason for the loan rejections.
Knox said the SBA will give reasons for rejecting loans, including that the borrower was not a U.S. citizen or that the person had too much money on hand to qualify.
Knox said the fact that McGarity was told that the SBA did not give a reason for the loan rejections did not give him a “warm and fuzzy” feeling.
Banks are saying the loans are not lucrative enough for them because no upfront fees can be charged, according to Knox.
One woman in the audience of about 20 people wondered if President Obama knew about the drawbacks of the loan program.
Knox said he is sure Obama would flip a switch to correct the situation if he could.
“But there is only so much he can do. There is only so much Congress can do,” Knox said.
Brent Bailey of Interstate Communication Services, an information technology company, stood up during the meeting and walked to the front of the room.
Bailey told Knox to let him know if some kind of incentive is offered to banks to stimulate the flow of loans.
“Then I’m in,” Bailey said.
“Without it, it’s just talk,” said Bailey, who left the meeting.
“It sounds like our banks are stopping us at the door,” said another woman in the audience.
The City of Hagerstown hosted the meeting so people could share their experiences with the program and offer ways to improve it.
Knox offered possible solutions, like going back to a bank again after an initial loan rejection. The bank might have changed its mind about the loans, Knox said.
Business owners can let banks know they are not happy about their decision not to offer the loans, Knox said.
Business owners also can take their business to another bank, although there might be a waiting period with the new bank before a loan can be considered, Knox said
But local business owners complained Monday night at City Hall that special loans for businesses through the U.S. Small Business Administration are slow to get approved.
Provided under the American Recovery and Reinvestment Act, the interest-free loans are for up to $35,000. They are intended for established, viable businesses that need short-term help with their debts.
But Al McGarity said he and six other people were turned down for the loans even though they met all the program’s qualifications.
McGarity, owner of Robbies Billiards and Game Room Outfitters in Williamsport, said the bank told him and the others that the Small Business Administration turned down their loan requests.
McGarity told Edward Knox, lender relations specialist for the SBA, that the bank claimed that the SBA did not give a reason for the loan rejections.
Knox said the SBA will give reasons for rejecting loans, including that the borrower was not a U.S. citizen or that the person had too much money on hand to qualify.
Knox said the fact that McGarity was told that the SBA did not give a reason for the loan rejections did not give him a “warm and fuzzy” feeling.
Banks are saying the loans are not lucrative enough for them because no upfront fees can be charged, according to Knox.
One woman in the audience of about 20 people wondered if President Obama knew about the drawbacks of the loan program.
Knox said he is sure Obama would flip a switch to correct the situation if he could.
“But there is only so much he can do. There is only so much Congress can do,” Knox said.
Brent Bailey of Interstate Communication Services, an information technology company, stood up during the meeting and walked to the front of the room.
Bailey told Knox to let him know if some kind of incentive is offered to banks to stimulate the flow of loans.
“Then I’m in,” Bailey said.
“Without it, it’s just talk,” said Bailey, who left the meeting.
“It sounds like our banks are stopping us at the door,” said another woman in the audience.
The City of Hagerstown hosted the meeting so people could share their experiences with the program and offer ways to improve it.
Knox offered possible solutions, like going back to a bank again after an initial loan rejection. The bank might have changed its mind about the loans, Knox said.
Business owners can let banks know they are not happy about their decision not to offer the loans, Knox said.
Business owners also can take their business to another bank, although there might be a waiting period with the new bank before a loan can be considered, Knox said
