A veterans business loan is a type of small business loan designed for veteran entrepreneurs to start, operate, and grow their businesses. These loans are specifically granted to service-disabled veteran-owned small businesses. This means veterans who want to start their own company must be at least 10 percent disabled from any type of Service-Connected disability and owned the company outright or have co-ownership with no more than five
other people. It is estimated that up to 75 percent of startup companies fail within three years, according to the Small Business Administration, so these loans offer much needed stability for veteran entrepreneurs.
Veterans Business Loans are available through federal government agencies like the U.S. Department of Agriculture and the SBA. Both of these federal agencies have concerns of supporting veteran businesses. They have also interests in offering various supportive resources to veterans who want to start or grow their own business. The USDA Small Business Administration is the largest federal agency concerned with small business loans. And it offers various types of loans including:
What are the benefits of veteran business loan?
There are many benefits that come with a veterans business loan. For example, they have no pre-payment penalties and no down payment requirement. Repayment is also tax deductible and involves low interest rates. It is important to note that you’ll have access to these funds much faster than other types of loans because they don’t require credit checks or collateral. Additionally, there are no limitations to the amount you can borrow.
In some cases, veteran business loans are subject to a Veterans Business Equity Loan (VBEL) program. This is a special program that allows for veteran entrepreneurs to borrow against the equity in their business. This can be useful if the business is already generating profits and needs additional capital to expand.
What types of veterans business loan are there?
There are two federal government programs that provide loans for veteran entrepreneurs:
The SBA publishes several resources for veteran entrepreneurs. It includes this of 22 free veteran business starter kits and this list of “4 Steps to a Successful Veteran Small Business.” The USDA publishes a publication for veterans called “Veterans & Female Farmers”. They also publish several news releases on their website. And it includes this one entitled “USDA announces $1.1 billion in loan guarantees for rural businesses, communities.”
Each of these government agencies has additional programs and resources available to veterans who want to start or grow their own business.
Also Read: How to Get a New Business Loan?
Veteran Business Expertise
Veterans require different assistance than non-veteran business owners. So, it is important that you work with an expert that understands your concerns and needs. That is what gets the job done right the first time. To explore the specific needs of your veteran business, you should work with an expert that understands your business mission. They can help you put together a customized plan for growth.
U.S. Department of Agriculture (USDA)
Veterans are eligible for loans from the U.S. Department of Agriculture (USDA) if they they have an involvement in farming, ranching and small business, regardless of disability status or where they live. There is also no down payment requirement on these loans. It makes them particularly useful for veterans who use their own personal funds to start their own businesses or who have trouble getting financing due to low credit scores or other factors that may increase standard lending standards.
Veteran Entrepreneur Assistance (VEA)
Veteran Entrepreneur Assistance (VEA) is a program of the USDA’s Rural Development Office. It helps small businesses owned by veterans and women in rural areas. VEA loans help grow these small businesses, either by providing more capital or improving facilities and equipment. This means to reducing the cost of borrowing through lower interest rates and making it easier for veterans to access credit. It can make it easier for them to start their own business or expand their current one.
The USDA also offers training workshops to assist veteran entrepreneurs with scaling up their operations. One such workshop, “Creating Successful Veteran-Owned Businesses,” was held in Worcester County, Virginia on February 22, 2013. The objective of the workshop was to identify challenges facing veteran business owners, and to share information on programs that can help them overcome those challenges.
The Small Business Administration (SBA)
The Small Business Administration (SBA) helps veterans in several ways including guaranteeing loans for veterans owned businesses. Veteran owned small businesses are eligible for loans of up to $500,000. With the SBA Guaranteed Loan, the government guarantees a portion of the loan so banks and other lending institutions will offer lower interest rates and better terms.
In addition to guaranteed loans, SBA offers assistance with developing a business plan and finding funding sources. It also provides discounted training opportunities at their Small Business Development Centers (SBDC). It also provides free online counseling through its SCORE counseling program.
Veteran Business Assistance (VBA)
The aim of the creation of the Veteran Business Assistance (VBA) was to assist veterans in businesses that are run by women, minorities and those with disabilities. VBA loans offer special programs that make it easier for these businesses to grow and succeed. These loans help small businesses grow by helping them access capital, offering reduced or zero interest rates and assisting veterans with unique business needs. VBA is funded at least in part by the U.S. Department of Labor through the Small Business Administration’s Office of Women’s Business Ownership, which enables women to become owners of small businesses—and thus be able to hire people and expand their enterprises—and engage in self-employment opportunities through small businesses that are owned by women.
Veteran Owned Business (VOB)
Veteran Owned Business (VOB) contracts are awarded to both veteran owned businesses and non-veteran owned businesses with more than 51% veteran ownership. In order to be eligible for a VOB contract, the business must be at least 51% owned by individuals who are veterans or service-disabled veterans. Service disabled veterans have a disability that was incurred or aggravated in the line of duty in military service. And that is not compensated for by the Dept. of Veterans Affairs (VA). More than 200 vendors across the country now participate in VOB contracting. They include many Fortune 500 companies such as Boeing, Lockheed Martin and Northrup Grumman.
VOB program points of contact are located in each state and territory. Local VOB contacts can provide information about the VOB program, procurement opportunities, local hiring and outreach events, training programs and contracts with their vendor/supplier. Veteran Small Business Set-Aside Programs give preference to veteran owned business when procuring goods and services up to 5% of the federal contract dollars awarded by the Contracting Officer.
The U.S. Department of Transportation (DOT)
The U.S. Department of Transportation (DOT) is working to ensure that all firms that have a goal of selling to the federal government are aware of this important source of revenue. State DOT’s also have a responsibility to help small firms understand the benefits of selling to the federal government. The Small Business Administration (SBA) has created and published a book titled, “Valuable Federal Government Purchasing Opportunities for Small Businesses”. Most states have recognized the need to help small business owners become aware of this important source of revenue. So, they have commissioned a copy of this book for each small business owner and their local SBA district office.
Veteran-owned businesses play an incredibly important role in our country as they help to create jobs, strengthen local communities, and revitalize our economy. Veterans are also known for their integrity and leadership skills, which are essential traits that are essential for any type of business success.
Important facts about veteran business loan
- Veteran business loans are provided through federal agencies like the US Department of Agriculture and the SBA.
- Veteran small business loans are tax deductible
- Similarly, veteran entrepreneurs can get these small business loans through military or federal agency, or private lenders.
- Veteran business loans are designed for veteran entrepreneurs to start, operate, and grow their businesses
- Up to 75 percent of a startup’s survival rate is bad luck. That is why these loans will give you the stability you need.
- Veteran business loans are available through federal government agencies like the US Department of Agriculture and the SBA. Both of these federal agencies are concerned with supporting veteran businesses, and offer various supportive resources to veterans who want to start or grow their own business.
- Veteran entrepreneurs can get these small business loans through military or federal agency, or private lenders.
- Veteran business loans are designed for veteran entrepreneurs to start, operate, and grow their businesses.
- Now that you’re in a better position on what veterans business loans are all about. Let’s get into some detailed information on how they work!
Veteran Business Loans requirements
To receive a business loan, you must be able to show that you have a plan for the business. And also that your plan can be executed and/or sustained. Additionally, you must also have acquired enough expertise so that you will know how to successfully operate the business. When applying for this type of business loan, it is important that your financial statements are accurate and include all the information required by your lender.
Each loan has different requirements and is different in its own way. These requirements vary depending on the type of lender that you are using as well as whether or not you are using SBA’s SBA Loan Guarantee or if you would like to use a private business loan.
Who can use a veteran business loan?
This loan is available to everyone, but this is not true for most other types of business loans. This makes sense because the SBA uses government resources to make these loans available. And it does not limit its own funding by only making them available only to specific groups of people.
The SBA does not distinguish between race, sex, age, or the amount of money you have in your personal savings account when helping veterans start their businesses. They also do not demand that you prove that you are politically conservative or that you share their political views. The bottom line is that they are called veteran business loans because they will help veterans just like other businesses.
All veterans can get a veteran business loan and can receive these loans regardless of their political views. These loans are not intended to promote any particular political viewpoint. They are intended to help veteran business owners. And that is what they will be used for by most of the people who apply for them.
Veteran-owned business loan is an important part of funding veterans’ entrepreneurship, small business development, and job creation efforts within America’s communities and state economies.
There are also many other organizations that provide funds to help veteran entrepreneurs obtain small business loans. You can visit this link for more info about those organizations.
There are many loan programs that can be used by veteran business owners to help them with their business. Veteran Business Loans are not the only federal government loans they can get, but they are an important part of helping veteran entrepreneurs grow and expand their businesses.