DID YOU KNOW...?

504 DEBT REFINANCE UPDATE:

What types of expenses are eligible for 504 temporary debt refinancing?  Any expense incurred by the small business which is now due and payable or will become due and payable within 18 months of the 504 Loan application, other than: 

• Acquiring a new business (e.g., a doctor wants to purchase a retiring physician's practice);
• Acquiring a new property;
• Financing a change of ownership with the buyout or buy down of one or more co-owners;
• Paying off or paying down debt owed to owners (e.g., shareholder debt);
• Paying off or paying down an owner's personal expenses (e.g., making alimony payments);
• Renovation or build out of the existing facility

is an eligible business expense.

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DID YOU KNOW...?

SBA Life Insurance Requirements

Although obtaining life insurance on the primary business owner may be a credit issue, generally SBA requires some type of life insurance coverage on ALL SBA loans.

Credit decision aspects include:  

• (1) Is repayment of the loan dependent upon an owner's active participation in the business - life insurance is required;
• (2) Are there other sources of repayment or adequate collateral available - life insurance coverage may be waived or coverage less than the loan balance;
• (3) IF the owner dies, there is not adequate life insurance coverage, and there is a loan deficiency, SBA may repair/deny payment of the guaranty.

Lender MUST:

• (1) Obtain a collateral assignment identifying lender as assignee with the assignment acknowledged by the HOME OFFICE of the insurer;
• (2) Assure borrower pays premiums on the policy;
• (3) Have a copy of life insurance policy;
• (4) Include insurance requirement and amounts in credit memo and kept in file.

If Lender makes decision NOT to require life insurance, File MUST be documented with the decision outlining why lender does not believe life insurance is necessary and/or how the lesser amount was determined.

Staff Changes at Wakarusa Valley Development, Inc.

Lawrence, KS March 6, 2012 -- Troy Roberts, Executive Director of Wakarusa Valley Development, Inc. (WVDI), a Certified Development Company in the State of Kansas specializing in the U.S. Small Business Administration's 504 and 7a Loan Programs has announced the addition of two new employees, Miki Cady and Glenna Coleman.

Miki Cady is the Loan Closing/Portfolio Manager for WVDI with a primary focus in 504 Loan closing and portfolio management. Before joining WVDI, she worked for the Federal Government for 30 years, including the U.S Army Reserve 89th ARCOM, FDIC and 22 years with the U. S. Small Business Administration (SBA) in Wichita, Kansas in the Legal Division. Miki has over 20 years of experience with 504 Loan closings with the SBA. She is a native Kansan and a Wichita State alumnus.

Glenna Coleman is a Loan Officer for WVDI with a primary focus in marketing and 504 Loan origination as well as the regular SBA 7a Loan program. Before joining WVDI, she worked for the Federal Government for over 38 years all with the U.S. Small Business Administration. Her career began in the Wichita, Kansas SBA District office in portfolio management, moving to the SBA Region VII Office in Kansas City, Missouri as an IT specialist and 19 years with the SBA Kansas City District Office as an underwriter for 504 and 7a Loans and then in the area of marketing and training with lenders.

"I had worked with WVDI for 10 years while at SBA and was impressed with their dedication to businesses and lenders. I'm really excited to join the WVDI team and continue that relationship," said Cady.

"I am excited about joining the team at WVDI to continue working with lenders and business owners in assisting with financing options," said Coleman.

"Glenna and Miki bring a wealth of experience in SBA lending to WVDI. As an organization committed to providing access to capital for the small businesses we serve, their expertise will continue this mission as well as provide growth to WVDI," said Roberts.

Glenna may be reached by email at gcoleman@wakarusavalley.org or phone at 816-699-372. Miki may be reached by email at mcady@wakarusavalley.org or phone at 785-749-7600.

For further information about Wakarusa Valley Development, Inc. and current 504 Loan interest rates, check out our website at www.wakarusavalley.org.