NEW HOPE FOR SMALL BUSINESSES
U.S. Treasury provides an additional $608 million to
Small Business Lending Fund
Two weeks ago Neil Borofsky, the Special Inspector General for the government’s bank bailouts, called the government’s HAMP Mortgage Modification Program an abysmal failure. A Bill has been introduced in Congress to scrap the entire program and redirect the HAMP funds to building jobs.
A typical HAMP Loan Modification usually takes 6 months to 2 years (yes, 2 years) to complete, and only 7% of all loan modifications are ultimately successful.
In contrast, a Loan Modification conducted within a Chapter 13 Bankruptcy case can take approximately 2-3 months, and the success rate is closer to 50%.
Additionally, a Chapter 13 Bankruptcy case settles all other debt as well: credit card debt, business debt and medical bills. If a second mortgage is completely underwater, that mortgage may be “stripped down” to an unsecured debt and paid off for as low as two cents on the dollar.
Every Bankruptcy Judge from Brooklyn to Poughkeepsie has now adopted the “Loss Mitigation Procedures” to facilitate mortgage modifications within a bankruptcy case. The Loan Modification is tightly supervised by the B The U.S. Treasury recently announced that an additional 61 community banks would receive $608 million to lend to small businesses through the Small Business Lending Fund (SBLF).
The SBLF was enacted into law by President Obama as part of the Small Business Job Acts of 2010. It is a dedicated fund that encourages lending to small businesses through small community banks.
Thus far, the SBLF has provided approximately $2.4 billion in funding to 191 community banks across the country.
The interest rate paid by the community banks to the SBLF is dramatically reduced, providing a strong incentive for those banks to provide lending to small businesses at lower interest rates.
Small businesses employ roughly 1/2 of all Americans and currently account for approximately 60% of current job creation. Nonetheless, small business owners were the hardest hit during the recent recession, and most banks cut the lines of credit available to small businesses.
The Small Business Jobs Act has also initiated 17 direct tax breaks to small businesses to support job creation, investment and growth.
To find a participating community bank near you, go to the U.S. Treasury website at www.treasury.gov.
The Law Offices of Allen A. Kolber, Esq., offers full service support for businesses and individuals throughout the five boroughs of NYC and the Hudson Valley. Our clients are entrepreneurs, investors, partnerships, and small to midsize companies and corporations.
Our firm has particular expertise in starting a new business or purchasing an existing business, including:nkruptcy Court Judge. The Court first issues a tight and short time frame to complete the process. Each attorney is provided with the name, address and e-mail address of an assigned bank negotiator. The Court will hold regularly scheduled hearings, and require the parties to submit affidavits of progress with the Court.
Most importantly, the Bankruptcy Court prohibits a bank from proceeding with foreclosure while the Bankruptcy case proceeds.
A well planned Chapter 13 bankruptcy case can allow a family to enter into a comprehensive financial plan that will lower its mortgage payments, erase most, if not all, credit card debt and medical bills, and pay off a second unsecured mortgage, while preserving a family’s pension and retirement accounts in full. Most importantly, it can save your home.
Sale or purchase of stock or assets
Employment and Consulting Agreements
Partnership or Shareholder Agreements
Financing or leasing
Banking and loan transactions including loan workouts