Simply Junior

If you have been struggling with trying to stay in business, you’re not alone. The slow economy has been responsible for affecting the lives of millions, for the US and everywhere else. American’s President Obama has seen what homeowners, companies, and consumers are going through, and put forth a $787 billion stimulus in February of 2009 to promote economic growth.

Among those who are pegged to receive assistance through funding and the addition of jobs include scientific research groups, schools, energy programs, Medicaid, and contractors. But what about small business owners? Are you eligible? How do you go about the application process?

The good news is that since everyone is facing financial strains, the Stimulus has a program that targets small businesses. Receiving assistance can make the difference in having your company rise above to the level of bigger corporations with whom you might have been finding difficult to compete. Here’s what you can do to benefit from the Stimulus:

The Small Business Administration (SBA) has come up with a way for you to be guaranteed for up to a $35,000 loan without having to pay for it for up to 12 months. They have $426,000,000 in government funding to use toward helping small businesses like yours, so that it keep you from losing your company.

Have high interest rates kept you from obtaining a loan in the past? You no longer have to worry about that. Under the Stimulus, you are able to refinance a small business loan of up to $10,000,000 if it was issued before the Stimulus went into affect.

Did you know that you can increase your company’s private capital or investments from 300% or $15 million, depending on the lesser amount, to 300% or $150 million as the maximum? This will enable your business to become established in the marketplace and local community, so that you can continue to grow your business using Stimulus money for marketing, professional development, or applying the funds to areas of your company that need it most.

Banks and Credit Unions are financial institutions that offer a number of services to their customers such as loans and money accounts. Many people do not realize that there are a number of differences between a bank and a credit union. When deciding if you should do your banking at a credit union or bank, it is important to understand the differences so that you can choose the financial institution that meets your needs.

Credit Unions

When credit unions were first established, they were cooperatives that helped workers with financial troubles. Now, these financial institutions are community based institutions which operate as a non profit institution. According to Bankrate.com, “Credit unions have topped the consumer satisfaction ratings in American Banker’s annual survey for 12 years in a row.” Anyone in the U.S. can join a credit union. If you want to have an account at a credit union, you are required to have a membership. Members are equal part owners and receive shares based on their contribution. The more one contributes the more shares and profits they receive. The Credit Union Board of Directors are made up of volunteers or elected members from the community. They promote saving and spending money carefully.

This financial institution will often offer finance education programs to their members. They are also exempt from most state and federal taxes. They will normally finance community development projects. Interest rates tend to be lower than bank rates. Since every member is an equal owner, service is more individualized and friendly. As well, because of the tax savings and no highly paid administration, they are able to provide such services as: free checking accounts, savings accounts with high interest rates, and low rates on auto loans, mortgages and credit cards. Up to $100,000 of a member’s money is insured and regulated by the National Credit Union Association, which is the same as the Federal Reserve Bank’s coverage. One downside of a credit union is that there are not as many as traditional bank branches.

Banks

Banks are owned by a private company and are publicly traded for-profit institutions. The Board of Directors is appointed by the company or shareholders. They are locally based but have numerous branches across a broad region. Rates, fees, and penalties are generally higher than credit unions. They tend to have more of a selection of products and services. Bank account holders will receive some interest on a particular account. Their services are customized to all of their customers and not individualized. The interest rates on loans are generally higher than CU’s. Banks have more ATMs, branches, and investment products and services. Banks tend to finance projects that will give them a big return on their investment.

Both banks and credit unions have government guarantees on a certain amount of funds in a customer’s account, making them safe. When choosing between a bank and a credit union, customers have to consider their own unique current and future needs.