New Bedford Economic Development Council wins SBA designation for lending program

NEW BEDFORD — A new certification by the U.S. Small Business Administration will enhance the New Bedford Economic Development Council’s ability to secure funding for local businesses, according to Executive Director Matthew Morrissey.
The NBEDC recently became a certified Community Advantage 7(a) lender through the SBA, which enables the council to attract private capital through a substantial federal government guarantee on loans up to $250,000.
The federal government guarantees 85 percent of Community Advantage 7(a) loans up to $150,000 and 75 percent of larger loans, according to the SBA. Through this guarantee, the SBA shares the risk if a borrower defaults by paying the lender 75 to 85 percent of the remaining principal, said SBA spokesman Michael Stamler.
As a Community Advantage lender, “we will be able to attract far more private capital to loan because the private banks will understand that we are Community Advantage certified and their money will be backed up by the federal government,” said Morrissey. He said NBEDC’s lending has supported area businesses ranging from No Problemo, a downtown restaurant, to Darn It! Inc., a New Bedford distribution and refurbishment company. The Community Advantage program is a three-year pilot meant to increase the number of lenders investing in underserved areas, according to the SBA.
“As a current investor in the NBEDC Lending Program, we have seen firsthand the local impact of their forward thinking approach to economic development,” said Bank of America Massachusetts president Bob Gallery, in a press release. “Their certification as a Community Lender, which had our full support, will expand their services and build on an impressive track record.”
Stamler said Thursday that the Community Advantage 7(a) program currently has 50 certified lenders. A roster of Community Advantage lenders updated July 5 lists the NBEDC among three certified lenders in the state.
July 21, 2012 12:00 AM
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