The federal government has provided bailout money to assist the many struggling small businesses throughout the United States. According to the Small Business Administration (SBA), the federal government has allotted $730 billion for that organization to assist small-business owners in keeping their companies afloat. This funding is primarily available for the SBA to insure or underwrite loans for small businesses. Tapping into the federal bailout money for small businesses is not as easy as picking up the phone and making a request, but with some time spent in research and plenty of patience and persistence, small-business owners will be able to acquire available funding.

Step 1.

Contact your local office of the Small Business Administration. The federal bailout money for small businesses will ultimately pass through banks and other lenders, but the SBA can provide the information you need on how to apply for it. The SBA will be responsible for underwriting small-business loans (in the same way that the Federal Housing Administration underwrites housing loans), so you will need to start there. Take the time to visit the local office in person, as you will be much harder to ignore and more likely to receive useful information.

Step 2.

Request a list of approved banks or lenders for SBA loans. The SBA underwrites the loans, but the banks provide the actual loan packages. The workers at your local SBA can tell you more about the banks to which you can apply and the loan options that will be best for your business.

Step 3.

Contact the bank to find out about small-business loans. Let the bank know that you are applying through the Small Business Administration, and make sure the loan package reflects this underwriting. For instance, an SBA-backed loan should have reduced or eliminated fees, as well as SBA guarantee for as much as 90 percent of the loan.

Step 4.

Apply for an SBA-insured loan. Do not complete or sign the loan application until you are sure that the loan is the best for your business and reflects your business’s ability to make the necessary payments.


Even though the loan is backed by the SBA, you will still be responsible for making payments. If you default on the loan, the SBA will pay the remainder, but defaulting on a loan can ruin your business’s credit for a number of years. Only take out a loan if you feel confident that your business can support it. The purpose of the federal bailout money for small businesses is to provide loan options to businesses that might not be eligible for loans under banking requirements. It is not, however, intended as a “freebie” to keep small businesses going.