Bay Colony Development Corp. in the News

Thanks for taking a look at our new website.  We have a feeling you will find it a great tool for learning more about the SBA 504 program, determining eligibility, and receiving prompt responses to your inquiries. Remember, there is no substitute for a face to face meeting. We would be happy to meet with you at any time to discuss your specific project or just discuss the program in general.  Feel free to contact us.

Our new website has some amazing new tools, including:

• An eligibility wizard allows the user to determine if your specific project meets the SBA’s general eligibility requirements for the 504 Program.
• An on-line loan application that asks you to fill in only fields that are relevant to your specific loan request and prompts you with specific questions to help you determine what information you will need to provide, based upon your responses.
• A LIVE CHAT feature:  If you are online and want to speak to a loan specialist, you can choose this option and we can chat online, in real-time.
• A Bankers Only section with a banker specific information, flowcharts, and a more robust Eligibility Wizard.

Kick the tires, take a test drive.  We would love to know what you think.  Please feel free to send any comments using our contact form.   Once a month for the first few months, we will review the comments and our staff will determine which we feel best captures our intent for the site or provides us with some insight into how to improve it.  The winner will receive a $100 gift card.

Why a new website? Websites can be nothing more than electronic brochures–or–they can be interactive, even intelligent tools that guide users through a process that leads them to an educated, prudent decision.  If you were a visitor to our old site, you would have found it was informative, but it did nothing specific to help you determine if your particular project would meet the SBA 504 program requirements.  It also did not allow you the opportunity to start or complete the application process.  We did an extensive review of CDC websites across the country.  We were unable to find a site that can currently do everything our new site can do.

We wanted to address specific pain points that are felt by borrowers and lenders alike.  Some of the more common issues are:

• “I read this stuff and I feel like I need a PhD to figure it out”
• “I have to sift through a lot of information that doesn’t apply to my project to try to determine if I am eligible.  Even then, I’m not sure.”
• “I can’t apply online, or the application is really difficult to navigate and edit and I have to type the same thing on multiple forms again and again.”
• “I can never seem to reach someone when I have a question.”

We feel that we have addressed these concerns, however your feedback will help us continue to improve.  Please note, we are more than happy to complete the majority of the 504 application for you and just have you review and sign it.  If you prefer to start or finish the application without our assistance, our on-line application is a great tool.  In fact, we intend to use it internally to save time.

We look forward to hearing from you.

Regards,

The Bay Colony Staff

The following excerpts were taken from a recent article posted on the NADCO Website.  It points out why now is a better time than ever to consider SBA 504 financing.

National Association of Development Companies (NADCO) reports SBA 504 loans encouraging business expansion remain available for America’s small business entrepreneurs

McLEAN, Va, (November 25, 2008) – One needs to look long and hard for even the smallest success in today’s dramatic economic downturn. While virtually every analyst and pundit is wallowing in an economic forecast of doom and gloom, it may come as a big surprise, but the SBA 504 loan program is still helping small businesses nationwide to expand (see NADCO’s 2008 Economic Impact Study). No $700 billion bailout, no Wall Street fallout, just Main Street small businesses that are turning SBA 504 loans into increased profits while adding employees and bolstering their local economy’s tax base.

When the economy is strong and access to capital is relatively easy, there is typically less demand for SBA financing. In the case of the SBA 504 loan, a private sector lender partners with a Certified Development Company (CDC) to provide financing for the purchase, construction or renovation of owner-occupied commercial real estate. Use of the SBA 504 loan tends to become increasingly important as a source of long term financing when traditional sources of money decline as they have in recent months.

In spite of the credit crisis that has crippled many financial institutions and slowed lending for commercial expansion, CDC’s are supporting entrepreneurs in virtually every US market with SBA 504 loans for qualified small businesses. “The credit crisis has not frozen the SBA 504 loan program. Loans are still available for businesses seeking to grow through real estate acquisition, expansion of existing facilities, or purchase of new equipment,” according to NADCO President Christopher Crawford. “CDCs, our banking partners and the SBA are doing business as usual and will continue to do so for the long haul.”

SBA 504 loans provide a steady source of new long-term capital at a fixed rate, and frequently with only 10% down on a new project for a small business. These loans are the perfect tool for conserving cash for operating expenses. A vacant commercial property in a neighborhood can represent an opportunity for a small business owner who needs more space. Now may be the perfect time to consider expanding into a larger facility, or simply seizing the chance to buy a first building at an advantageous price.

No Risk Loans, SBA Guarantees and No Federal Expenditures The CDC industry reports that virtually all lending partners using the 504 program are still actively lending on SBA projects to qualified expanding small business borrowers. The SBA 504 loan program remains the ideal program for banks, as it mitigates private sector lender risk on commercial real estate financing through the use of an SBA guarantee.

Funds for the SBA 504 loan program come from the sale of long term bonds each month. These bonds carry the full faith and backing of the U.S. government and present an attractive investment option for money managers, pension funds, insurance companies and other large institutional investors. The sales of SBA 504 bonds, known as debentures, have been successfully conducted every month for the past 27 years. Crawford concludes, “The amazing part about 504 is that it costs the federal government absolutely nothing, due to the low default rate costs that are covered by its low fees. Likewise, there is no requirement for a Congressional appropriation of funds for 504.”