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Understanding the Secondary Market Lending Authority and Its Impact
Definition & Meaning
The Secondary Market Lending Authority refers to an office created under Section 509(c) of the American Recovery and Reinvestment Act of 2009. Its primary function is to provide loans to systemically important broker-dealers in the Small Business Administration (SBA) Secondary Market. These loans are intended to finance the inventory of government-guaranteed portions of loans that are originated, underwritten, and closed under the Small Business Act, or to finance pools of such loans.
Table of content
Legal Use & context
This term is used primarily in the context of federal financial assistance and economic recovery efforts. It is relevant in areas such as business finance and economic development. Legal practitioners may encounter this term when dealing with SBA loans and secondary market transactions. Users can manage related forms and procedures through resources like US Legal Forms, which offers templates drafted by attorneys to assist in navigating these processes.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A systemically important broker-dealer applies for a loan from the Secondary Market Lending Authority to purchase government-guaranteed loans to expand their inventory.
Example 2: A broker-dealer uses funds obtained from the Secondary Market Lending Authority to finance a pool of SBA loans, enabling them to offer more financing options to small businesses. (hypothetical example)
Relevant laws & statutes
The primary statute governing the Secondary Market Lending Authority is the American Recovery and Reinvestment Act of 2009. This act outlines the establishment and functions of the authority, focusing on economic recovery through support for small businesses.
Comparison with related terms
Term
Definition
Secondary Market
A market where previously issued financial instruments are bought and sold.
SBA Loan
A loan backed by the Small Business Administration, designed to help small businesses access financing.
Broker-Dealer
An individual or firm that buys and sells securities on behalf of clients or its own account.
Common misunderstandings
What to do if this term applies to you
If you are a broker-dealer looking to access loans through the Secondary Market Lending Authority, consider the following steps:
Review the eligibility criteria to ensure you qualify as a systemically important broker-dealer.
Gather necessary documentation regarding your loan needs and business operations.
Explore US Legal Forms for templates that can help you prepare your application.
If your situation is complex, consider consulting with a legal professional for tailored guidance.
Find the legal form that fits your case
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