NAR Urges Congress to Pass Small Business Lending Act
Date 7/14/2010
Last week, NAR urged members of the U.S. House of Representatives to support H.R. 5297, the Small Business Lending Fund Act of 2010 (Rep. Frank, D-MA). Under H.R. 5297, the U.S. Treasury would be authorized to lend up to $30 billion to interested community banks, in order to expand access to credit for small businesses. These loans would be required to be repaid, with interest, over a 10-year period. The bill also provides incentives for small banks to increase small business lending by adjusting their initial 5 percent loan interest rate relative to the amount of their small business lending activity. For example, banks that increase such lending by 10 percent or more would pay an interest of one percent.
Additionally, NAR asked lawmakers to support Amendment #4 (Minnick, D-ID), which would broaden eligibility for the program by including non-owner occupied commercial real estate in addition to owner-occupied commercial real estate loans.
More than $1.4 trillion in commercial real estate loans will come due by 2014, and roughly 65% of these deals will have trouble getting financing. Depressed conditions in the small business community continue to negatively affect the commercial real estate industry, which threatens our nation's economic recovery.
Soon after NAR submitted its letter, H.R. 5297 passed the House by a vote of 241-182. Also, Rep. Minnick's amendment was passed by the House. Prospects for small business lending legislation in the Senate are unclear.
Attached is the letter from NAR to Congress.