Tuesday, October 18, 2005

Wow - 20% Failure Rate on SBA Loans from 911

At the time of Sept. 11th the small company where I worked was already struggling. I was trying to dig them out of 20' hole without taking on more debt since they were already leveraged to the hilt. Quarter Four of 2001 and Quarter One and Two of 2002 were extremely painful. The partners wanted to take out a 911 SBA Loan while the company was already paying off another SBA Loan from before my time. The worst part about that loan? It was for equipment the company never received. D'oh! When the topic came up about another SBA Loan I just said nope, I'm not doing it. If you want you'll have to go through the process. My recommendation is cut, cut, cut and you the partners will have to go without a salary. Don't feel too sorry for them they still had quite a few legitimate expenses running through the company which most employees have to pay themselves. I'd never worked for a small company before, always had the big bucks of "Corporate" behind me. I thought it was stressful working through a system cutover for 30 hours straight but this took the cake over that. It's livin' on the ledge not the edge. But then, one of the partners had to be treated differently, she couldn't manage where myself and another director went without. Torqued me off. In the end the company made it through the hard times by literally watching every penny, what a difference for me. In previous postitions I used to call a difference of $100k flyshit. By the time I left the company had liquid cash of that amount in the bank. But, the bad spending habits were back and I was tired of being the bad guy trying to control something out of my control.

Apparently this was a big issue with those 911 SBA loans because a failure rate of 20% is pretty darn high. When will government ever learn? Probably never.

Guardian Unlimited World Latest AP: $1 Out of $5 in 9/11 Loans in Default

h/t Lucianne

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