Admin Seeks Rate Hike for Disaster Loans - Facing budget pressures, the
Bush administration is seeking to markedly increase the interest rates
that small businesses and homeowners pay for government-backed loans
designed to get them back on their feet after disasters ?
[ COMMENT: But those tax breaks for the ultra rich HAVE to stay in
place !!! I can?t put together a long enough string of curse words
that would adequately describe the ugliness of George W. Bush. He has
been the meanest leader this nation has ever had, and he is truly an
enemy of the poor and downtrodden citizens of the NewKKKnighted States
of America. ~~Suz~~ ]
http://tinyurl.com/d8fkv
Admin. Seeks Rate Hike for Disaster Loans
By THE ASSOCIATED PRESS
Published: February 8, 2006
Filed at 7:00 p.m. ET
WASHINGTON (AP) -- Facing budget pressures, the Bush administration is
seeking to markedly increase the interest rates that small businesses
and homeowners pay for government-backed loans designed to get them
back on their feet after disasters.
The Small Business Administration, already under criticism for its
handling of such loans after the Sept. 11 attacks and Hurricane
Katrina, is raising new concerns in Congress with the interest hike
proposal.
The agency wants a new formula that, if implemented today, would raise
the disaster loan interest rate for homeowners from its current 2.68
percent to more than 4.5 percent by pegging it to Treasury bill rates.
The increase, which would kick in five years after checks are cut,
would cost homeowners nearly $10,000 more over the life of a 30-year,
$100,000 loan. Administration officials said the change would not
affect loans taken out before October 2007.
Hector Barreto, chief of the small business agency, described the plan,
which requires congressional approval, as part of several ''necessary
fiscal restraints'' that will allow the administration to deal with
record demands in the wake of several disasters.
An SBA spokesman estimated the new rate would add about $41 million to
government coffers during the first year it is enacted.
The plan is drawing concern in Congress. Rep. Nydia Velazquez, the top
Democrat on the congressional panel that oversees the SBA, called the
plan ''simply heartless.'' Velazquez, who represents part of New York
City, said the White House has only given lip service to helping small
businesses.
''This is absolutely outrageous,'' she said. ''It's really
disheartening.''
The agency has been tightening its belt for several years now, nearly
halving its budget since 2001.
Under the White House plan, the SBA budget will total $624 million for
the next budget year beginning Oct. 1 - - about half of this year's
projected $1.2 billion. The previous spending plan, however, was
initially set at $534 million. It rose as a series of hurricanes
struck the Gulf Coast and Congress gave it more money to deal with the
damage.
The Bush budget also would increase the disaster loan rate for
businesses and homeowners to 4.61 percent under current interest rates.
Those rates are now 2.68 percent for homeowners and 4 percent for
businesses.
One businesswoman who benefited from the SBA disaster assistance
program after the Sept. 11 attacks said a 1/2 percent increase wouldn't
make an enormous difference in deciding whether to apply for a loan.
''When you need it, you need it,'' said Rae Anne Ryan, head of Travel
Affiliates in Gulfport, Miss. ''It's certainly wonderful when you find
out the interest rate is low. That's when you feel like you've been
assisted. But this isn't a significant amount.''
Most SBA disaster loans wind up going to homeowners. SBA officials
said they've approved $4.1 billion in disaster loans for victims of the
Katrina, Rita and Wilma hurricanes. Nearly $3.2 billion of that has
gone directly to homeowners.
Velazquez, however, noted that the agency has declined nearly four of
every five loan applications. She predicted that a higher interest
rate will result in more loan rejections.
= = = = = = = = = = = = = = =
"How are you doing, Big Brother? Nice to see you!"
"Life begins at conception and ends at birth. That's when the poor,
the disenfranchised, the overworked, the overloaded and the
under-and-un-supported women, without access to health insurance, have
to start raising these unplanned children."
* Only 1,075 days remaining until Inauguration Day, Jan. 20, 2009
* IMPORTANT!! Click here: http://tinyurl.com/cfsrc
* NOTICE: Due to Presidential Executive Orders, the National Security
Agency may have read this email without warning, warrant or notice.
They may do this without any judicial or legislative oversight. You
have no recourse nor protection from this intrusion on your personal
freedoms. You may not review your file which is secret. The President
reserves the right to use "signing statements" to give himself
permission to ignore the law, as he is above accountability.
