By DAVID BERTOLA
dbertola@bizjournals.com | 716-541-1621

The first U.S. Small Business Administration guaranteed loan under the new Small Loan Advantage loan program was recently completed in Buffalo. The program is aimed at increasing the number of lower-dollar SBA 7(a) loans going to small businesses and entrepreneurs in underserved communities.

Amanda Lowe received an SBA loan for $30,500 for her new beauty salon, Jagged Edges Salon, from Five Star Bank. The Small Loan Advantage loan was approved March 4, just one month after the initiative was announced.  

The program offers a streamlined application process for SBA-guaranteed 7(a) loans up to $250,000. The loans will come with the regular 7(a) government guarantee: 85 percent for loans up to $150,000 and 75 percent for those greater than $150,000. They seek to leverage the reach of SBA preferred lenders, many of whom are among the nation's largest lending institutions.

"In addition to SBA's already-existing loan programs, SBA is adding this new initiative, aimed at increasing the number of loans in these communities," said SBA Buffalo District Director Franklin Sciortino.

The program was unveiled earlier this year along with another new program, Community Advantage, which makes SBA's 7(a) loan program available to financial institutions it was not previously open to. It is focused on lenders such as Community Development Financial Institutions to increase the number of places a small business can go to get an SBA loan.

The SBA had loaned $42 billion to small businesses through the American Recovery and Reinvestment Act of 2009 and the Small Business Jobs Act.

On April 28, SBA Administrator Karen Mills was in Holland, N.Y., for a tour of roofing products manufacturer EcoStar LLC to highlight the role small businesses play in clean-energy manufacturing. During her visit, she talked about how the new programs would help more lenders connect with small businesses and streamline paperwork.

More details on SBA's Small Loan Advantage can be found at http://www.sba.gov/advantage.