Deborah Bach, once again, with the story at Three Sheets Northwest:
The U.S. Small Business Administration is launching a pilot program July 1 that’s aimed at helping boat dealers caught in the nationwide credit crunch.
The SBA will be offering Dealer Floor Plan loans, or “DFP loans,” for boat and other types of dealerships. The loans allow boat dealers to borrow against their existing inventory to buy additional stock. As that inventory is sold, the dealer repays the debt and can then borrow against the line of credit again.
The loans, which must be repaid within five years, will be available for between $500,000 and $2 million and come with a 75 percent government guarantee. DFP loans will be available only for titleable inventory such as boats and boat trailers.
Boat dealers locally and nationwide have been devastated by lower consumer demand and restricted credit caused by the subprime lending crisis. Lenders including Textron Financial, Wachovia and others have gotten out of marine lending over the past year, and the few remaining lenders have scaled back lending and increased fees. The downturn has led to the closure of numerous dealerships in the Seattle area, including Passage Maker Yachts and Olympic Boat Centers.
