What is the SBA MARC Loan Program?
MARC program is a loan product specifically tailored for manufacturers classified under certain NAICS codes.
Uses of proceeds
Maturity
- Line of credit: up to 10 years (revolving) with 10 year loan term out, for a total of up to 20 years.
- Term loan: up to 10 years for long term working capital.
Interest rates and fees
Interest rates
For line amounts greater than $350,000, interest rate cannot exceed Prime + 3.00%.
Fees
For revolving loans, the lender can charge an annual fee of up to 0.50% of the maximum loan (line) amount, or up to 2% annually of the outstanding balance for asset-based lines. SBA fee is the same as other SBA guaranteed loans.
Collateral and servicing
Collateral
Mandatory liens on accounts receivable, inventory and other business assets including a blanket UCC filing.
Servicing
Annual reviews, Debt Service Coverage Ratio testing, and collateral monitoring.
Eligibility
Manufacturers
Eligible under NAICS sectors 31–33. Maximum loan amount is $5 million.
Wholesalers and Food Supply Chain
Newly added or expanded under the updated rule. Maximum loan amount is $2 million.
Ownership
100% of owners and all required guarantors must be U.S. citizens or U.S. nationals with a principal residence in the U.S., its territories or possessions.
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Paul is NOT a loan broker but works for a financial institution that is a direct lender.