SmallBusinessNewz

Interest rates have been known to go up, down, and all around in recent months, making for both confusing and potentially unprofitable situations.  A new Small Business Administration move doesn't exactly simplify the matter, but should help small businesses get the best deal.

Historically, the prime rate has been pretty well tied to the London Interbank Offered Rate (LIBOR rate).  Our little recession messed that up.  A formal release from the SBA notes, "The mismatch between the rates is squeezing SBA lenders out of the lending market, since their costs are based on the LIBOR rate."

So the SBA is simply going to let borrowers take out loans based on either rate.  As explained in a statement by Sandy Baruah, the SBA's acting head, "This change will help more small businesses obtain capital to grow their businesses and create new jobs.  By allowing both rates, SBA is making its programs more flexible, increasing opportunities to access capital and giving both lending partners and small business customers more options to meet their needs."

This development seems to complement recent interest rate changes made in the UK.  It's nice to see agencies on both sides of the pond working to improve the position of small businesses.

Unfortunately, in somewhat related news, the SBA Disaster Loan Center is scheduled to close November 20th, so you should get in whatever applications or questions you've got before that day.