Disclaimer: I have been banking with Wachovia for nearly 2 years and am a huge fan. Their level of customer service is beyond anything I’ve experienced with any other bank…period. Please do not construe anything in the following post as a negative comment towards the bank in general.
To briefly recap Part 1 &Part 2 of this series about the new SBA Recovery Act incentives”. Our credit score took a large hit when my husband lost his job in June, 2006, and we had to make a sudden move to Colorado, putting our home in Florida up for sale just as the real estate market crashed. The value of our home has plummeted from $490,000 to approximately $245,000 at present. After attempting to sell or rent our home for nearly 2 years without success, and without the resources necessary to continue carrying a home in Florida AND in Colorado, we made the difficult decision to apply for a short sale of our Florida home. If you are not familiar with the short sale process, you basically have to stop paying for your home before a short sale will even be considered. We have been approved for a short sale, but in the meantime our credit score has dropped from the high 700 to the mid 500’s.
As every penny we have earned in nearly 3 years has been poured into maintaining two homes, I obviously have not had the funds necessary to upgrade or grow my business. Upgrades are becoming crucial at this point, but a conventional loan is pretty much out of the picture. That is why I hoping that incentives offered through the SBA as part of the Recovery Act can help provide me with the funds necessary to upgrade.
So, with documents in hand I headed to Wachovia first, as that is where I hold my personal and business accounts. I called ahead to make an appointment, explaining that I was looking for more information regarding an SBA loan.
TIP #1
The SBA’s website has a FAQ regarding the Recovery Act wherein they mention that you should “specifically ask about the Recovery Act and SBA loans” when approaching a lender. I didn’t realize at the time how important that advice was. My meeting at Wachovia was scheduled with a “financial specialist” who had no immediate knowledge of SBA loans and could not give me any specific information. So, let them know ahead of time!
My appointment at Wachovia did not provide me with any new information, but Wachovia’s local expert, their “Assistant Vice President Relationship Manager Small Business Banking”, did return my call before the day was through. The two options he offered me were:
1. An equity line secured by our home in Colorado; or
2. A traditional unsecured loan
It was pretty obvious that the information regarding our credit situation was not passed on to him, so I let him know about the short sale and also made it clear that I was not interested in an equity line. He said that he would be speaking with someone from the SBA tomorrow and would return my call the next day.
True to his word, the Wachovia representative called me back in the morning. He told me that SBA loans were only being offered to individuals purchasing property at this time. They were not providing loans for equipment upgrade.
TIP #2
The information regarding the granting of loans was presented in such a way that at first I believed he was talking about SBA policy. That confused me because I thought the SBA website had mentioned loans for equipment upgrades. After asking the representative specifically if this was SBA policy or Wachovia’s policy, the representative stated that it was the bank’s policy. If I had not asked that specific question I probably would not have continued my pursuit of an SBA loan. So make sure you ask! Or better yet, do what I will be doing next…
Although it may still be wise to check with your local bank first (I’m a novice at this) my next step will be to contact our Small Business District Office in Denver. Hopefully they can provide me with direction as to which lender’s I should approach given my business needs and save me some time.
Stay tuned!
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