Are you eligible to receive government financial
assistance? If you should need such aid, in the form
of a loan or loan guarantee, how and where can you
apply? While most people have heard of the SBA and FHA
loan programs, many may not realize that there are
other federal agencies that make or guarantee loans.
Housing Loans
The Federal Housing Administration provides
insurance of loans for purchase of 1 to 4 family
dwellings, including mobile homes, and refinancing of
indebtedness on existing housing. They also have a
program of financing for alterations, repairs and
improvements to homes. FHA loans are applied for
through approved lenders such as banks and savings &
loan associations. They are not applied for directly.
There is another FHA -- the Farmers Home
Administration -- under the Department of Agriculture,
and many people are unaware of this second agency. It
will provide loans to construct, repair or purchase
homes in open country and in rural communities of not
more than 50,000 population. Urban residents retiring
to rural communities, as well as existing rural
residents, may find that they are eligible.
Application should be made to the local FHA office --
they will be found in most county seats.
One of the easiest programs to qualify for is the
insured loan program of the Veteran's Administration.
Virtually all veterans are eligible, and if eligible,
you will find that obtaining a loan through VA is much
easier than any other program, and the terms are
better. Up to 95% of the price of the home can be
financed.
Small Business Loans
Many people are finding advantages in starting or
buying a family business. The program of the Small
Business Administration is quite well known. There are
actually two separate programs, direct loans, and
guaranteed loans made through local banks or other
approved lenders. The SBA is very short of funds at
present, so direct loans are nearly impossible to
obtain. The bank guarantee program continues to grow
however, and guarantees up to 90% of the amount lent by
the bank.
SBA has also started a program of guaranteeing
loans through commercial lenders, and the possibilities
here are even better than at the banks. In particular,
contact The Money Store, which now has one of the
largest SBA loan programs in the country.
SBA also has disaster loans for small businesses
in disaster areas, and economic opportunity loans for
low-income people who can demonstrate good management
skills. These programs can also be arranged through
banks, and it is a good idea to talk to both your bank
and the SBA about the possibilities.
Businessmen or prospective business owners who are
unable to get an SBA loan often do not realize that
there are other federal agencies which make business
loans.
The Farmers Home Administration has a program of
business and industrial loans for projects located in
towns of under 50,000 population; although preference
is given to those in towns of under 25,000 population,
rural communities, and open country.
The Economic Development Administration has a
program of loans in areas which have been designated as
economically depressed, and this actually covers a very
large percentage of the country. Preference goes to
firms which will have an effect on increasing
employment in the area, and these loans may be combined
with SBA loans. The interest rates are very low. Full
information may be obtained from the Economic
Development Administration, Washington, D.C. 20230.
Education Loans
Best known are the Federally Insured Student Loans
which can be arranged through nearly any bank.
National Defense Student Loans must be arranged through
the college or university being attended, but the
Federally Insured Student Loans are also available for
study at private trade schools and similar educational
opportunities. Repayment does not begin until after
graduation.
Less known in the educational loan field are
nursing study loans, arranged through the school, and
medical study loans arranged the same way.
The Veterans Administration does not have a loan
program, but does have educational grants (non-
repayable) for veterans.
So before you decide that your dreams are beyond
your means, it will pay you to look into all of the
federal loan programs which might help your situation.
Often a combination of programs can do the trick, such
as buying a home under an FHA loan, and then getting an
SBA loan for a small business operated from your
garage.
