Lender's Corner

Not Just an SBA Lender
by Steve Willard, Vice President, NYBDC
Regional Manager, Western New York
swillard@nybdc.com

NYBDC has long been known as an SBA lender in general and a
SBA 504 company in particular.  While it’s certainly true that
SBA lending is our “bread and butter”, what is not widely known
is that NYBDC also makes conventional loans.  As with all of our loan programs, NYBDC’s involvement typically begins with a referral from a member bank.  One scenario for a conventional participation might involve financing for a franchised business that is not eligible for SBA financing.  Some common examples include Allstate, Hallmark and Save-A-Lot.

Another scenario might involve financing for a not-for-profit organization.  These are likewise not eligible for SBA financing.  As long as the majority of the company’s revenues are derived from private rather than public sources, is non-ecumenical, and has an economic development component (i.e. job creation or job retention), NYBDC can consider participating in these financing opportunities.  The Webster Montessori School (feature article) represents just one such example.

 However, NYBDC’s participation in conventional financing is not restricted only to
companies that are not eligible for SBA financing.  Member banks may request NYBDC’s participation to mitigate total related credit extended to a particular borrower or industry.  Another reason is NYBDC’s ability to offer attractive fixed rates up to 15 years.  Many
banks require rate re-sets in 5 year increments; NYBDC’s ability to offer a long term fixed rate and bifurcated notes allow the bank’s customer to enjoy the “best of both worlds”.

We will never lose sight of our relationship with the SBA and what that means to our
member banks.  Participating in conventional loans is simply another way in which we strive to support our member banks and help promote economic development in the Empire State.
 

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