SISMBD Loan: A Comprehensive Guide to Its Legal Definition and Use
Definition & meaning
A SISMBD Loan, or Systemically Important SBA Secondary Market Broker-Dealer Loan, is a direct loan provided by the Small Business Administration (SBA). This type of loan is specifically designed to support Systemically Important Secondary Market Broker-Dealers in financing the purchase and sale of guaranteed portions of loans. These loans are originated, underwritten, and closed under Section 7(a) of the Small Business Act. Recipients are required to use the funds solely for acquiring guaranteed portions of 7(a) loans from SBA lenders and for purchasing individual or pool certificates from registered holders.
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The SISMBD Loan is primarily used in the context of business financing and loan management. It falls under the purview of federal business loan programs, specifically aimed at enhancing liquidity in the secondary market for small business loans. This term is relevant in legal practices surrounding business finance, banking regulations, and compliance. Users may find forms related to loan applications and agreements through resources like US Legal Forms, which provide templates drafted by legal professionals.
Key Legal Elements
Real-World Examples
Here are a couple of examples of abatement:
Example 1: A Systemically Important Secondary Market Broker-Dealer applies for a SISMBD Loan to purchase guaranteed portions of various 7(a) loans from multiple SBA lenders to enhance their investment portfolio.
Example 2: A broker-dealer uses the funds from a SISMBD Loan to acquire pool certificates from registered holders, thereby increasing their ability to trade in the secondary market. (hypothetical example)
Relevant Laws & Statutes
Key legislation includes:
Section 7(a) of the Small Business Act, which outlines the framework for SBA loans.
13 CFR 120.1800, which defines the SISMBD Loan Program and its parameters.
Comparison with Related Terms
Term
Description
Difference
SBA Loan
A general loan provided by the SBA to small businesses.
SISMBD Loans are specifically for secondary market broker-dealers.
7(a) Loan
A specific type of loan under the SBA program for small businesses.
SISMBD Loans focus on the purchase of guaranteed portions of 7(a) loans.
Common Misunderstandings
What to Do If This Term Applies to You
If you are a Systemically Important Secondary Market Broker-Dealer considering a SISMBD Loan, begin by reviewing your eligibility under the SBA guidelines. Gather necessary documentation and explore US Legal Forms for templates that can assist you in the application process. If your situation is complex, it may be beneficial to consult with a legal professional for tailored advice.
Quick Facts
Attribute
Details
Loan Type
Direct loan from SBA
Eligibility
Systemically Important Secondary Market Broker-Dealers
Use of Funds
Purchase guaranteed portions of 7(a) loans
Governing Law
Section 7(a) of the Small Business Act
Key Takeaways
FAQs
Only Systemically Important Secondary Market Broker-Dealers are eligible for this type of loan.
The funds must be used exclusively to purchase guaranteed portions of 7(a) loans and related certificates.
Applicants should review SBA guidelines and may find useful templates through US Legal Forms.
