According to data collected in 2011, there are almost 22 million veterans in the United States. Many veterans run small businesses or wish to start a company and need capital to make their dreams a reality. Although the government does not give out small business grants to veterans, VA business loans, which are generally offered on favorable terms, help U.S. military veterans achieve their dreams of small business ownership.
The Department of Veterans Affairs and the Small Business Administration
The Department of Veterans Affairs (VA) is a benefit system set up to aid military veterans. The VA’s mission statement is: “To fulfill President Lincoln’s promise ‘To care for him who shall have borne the battle, and for his widow, and his orphan’ by serving and honoring the men and women who are America’s veterans.”
The VA itself does not give out business loans. VA business loans are given by the Small Business Administration (SBA) to veterans, soldiers, and military wives and widows. The SBA’s Office of Veterans Affairs oversees this lending, which is why these loans have come to be known as VA business loans.
What Kind of VA Business Loans are Available?
If you are interested in a VA business loan, there are two options that you need to be aware of – the Patriot Express Loan and the Military Reservist Economic Injury Diaster Loan (MREIDL). The Obama Administration started the Patriot Express Pilot Loan Initiative. Along with the loan, the Small Business Administration also provides counseling and training. Originally set to expire in 2010, the Patriot Express Loan is now extended through 2013 and may be extended again.
The MREIDL is designed to help businesses where the owner or other “essential employee” is called for military service. This VA business loan is designed to help the company meet costs that have resulted because of the loss of this employee.
Advantages of VA Business Loans
There are a number of advantages to a VA business loan; if you are a veteran who needs working capital for a small business, it’s a good idea to investigate these loans further. First, these loans are easier to qualify for than many other options. Those with imperfect credit who are turned down by other lenders may be able to find a VA business loan suitable for their needs. Next, the repayment policies for the loans are flexible. In fact, the Department of Veterans Affairs often offers financial assistance to veterans who cannot make their payments. Finally, the proceeds of the loan can be used for a number or purposes, including marketing, inventory, and labor.
How to Get Started
Now that you know the basics of VA business loans, it’s time to continue your research. We’ve put together a few essential pieces of information to get you up to speed. Check them out:
VA Business Loan Eligibility Requirements
VA Business Loan Forms
Ten Tips to Help You Find a VA Business Loan