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Patriot Express loan program: How it worked and alternatives

This SBA pilot program for veterans is no longer available. Here's how to find an alternative.

The Small Business Administration (SBA) Patriot Express program was a popular choice for veterans and active-duty military business owners — when it was available. But the SBA discontinued the program in December 2013. Veteran-owned businesses aren’t totally out of options. There are several other SBA and non-SBA business programs out there that offer loans and support to veterans.

The Patriot Express offered faster 7(a) loans

Launched in 2007, the Patriot Express loan program offered government-backed financing to veteran-owned businesses. These loans worked like SBA 7(a) loans with a faster turnaround time.

  • Businesses owned by veterans, active-duty service members and their families could qualify for this program.
  • Term loans and lines of credit of up to $5000,000.
  • Maximum interest rates ranged from Prime + 2.25% to Prime + 4.75% — same as a 7(a) loan.
  • The an SBA guaranteed up to 75% or 85% of the loan amount.
  • The SBA processing times was to as quick as one day — compared to the five- to 10-day turnaround on 7(a) loans.

SBA loans come with rates that are hard to beat, but can also be hard to qualify for. The Patriot Express program gave veteran-owned businesses the opportunity to up their chances of approval by competing with fewer applicants.

The Patriot Express program was canceled over high default rates

The SBA discontinued the Patriot Express loan program mainly because it had a higher default rate than other types of SBA loans.

In September 2013, a report by the US Government Accountability Office (GAO) found that defaults on Patriot Express loans cost taxpayers over $31 million. The SBA also didn’t provide enough oversight to make sure that lenders were actually giving these loans to veterans, service members and their families.

The Patriot Express loan program was a pilot, meaning it was set to either expire or get renewed. And in fact, the SBA renewed it once in 2010. But after the 2012 GAO report, the SBA couldn’t justify another extension even though it was popular.

The SBA has also canceled the Veterans Advantage 7(a) loan program

The Veterans Advantage 7(a) loan pilot program — also known as VA loans — was the main SBA loan program available to veterans after the Patriot Express loan program ended. But the SBA canceled the VA loan program too, on October 1, 2018.

While it was active, veteran-owned businesses could qualify for no guarantee fee or reduced guarantee fees on 7(a) loans under $350,000. These reduced fees are no longer available, but the SBA 7(a) loan program still comes with rates comparable to a bank loan. If you don’t mind a longer turnaround — you might want to consider this option instead.

Compare business loans you can apply for today

Name Product Filter Values Loan amount APR Requirements

Biz2Credit business loans
Finder Rating: 3.75 / 5: ★★★★★

Biz2Credit business loans
$25,000 – $250,000
Starting from 8.99%
6+ months in business; $150,000+ monthly revenue; 500+ credit score
Get only the capital you need through secure, prescreened lenders with this highly rated company offering SBA, expansion, working capital and other loans.

OnDeck short-term loans
Finder Rating: 4.6 / 5: ★★★★★

OnDeck short-term loans
$5,000 – $250,000
As low as 35%
600+ personal credit score, 1 year in business, $100,000+ annual revenue, active business checking account
A leading online business lender offering flexible financing at competitive fixed rates.

Fora Financial business loans
Finder Rating: 4.1 / 5: ★★★★★

Fora Financial business loans
$5,000 – $500,000
Varies
6+ months in business, $12,000+ monthly revenue, no open bankruptcies
Get qualified for funding in minutes for up to $500,000 without affecting your credit score. Best for companies with at least six figures in annual revenue.

Lendio business loans
Finder Rating: 4.75 / 5: ★★★★★

Lendio business loans
$500 – $5,000,000
Starting at 6%
Operate business in US or Canada, have a business bank account, 560+ personal credit score
Submit one simple application to potentially get offers from a network of over 300 legit business lenders.

ROK Financial business loans
Finder Rating: 4.7 / 5: ★★★★★

ROK Financial business loans
$10,000 – $5,000,000
Starting at 6%
Eligibility criteria 3+ months in business, $15,000+ in monthly gross sales or $180,000+ in annual sales
A connection service for all types of businesses — even startups.
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Name Product Filter Values Loan amount APR Requirements

Lendio business loans
Finder Rating: 4.75 / 5: ★★★★★

Lendio business loans
$500 – $5,000,000
Starting at 6%
Operate business in US or Canada, have a business bank account, 560+ personal credit score
Submit one simple application to potentially get offers from a network of over 300 legit business lenders.

ROK Financial business loans
Finder Rating: 4.7 / 5: ★★★★★

ROK Financial business loans
$10,000 – $5,000,000
Starting at 6%
Eligibility criteria 3+ months in business, $15,000+ in monthly gross sales or $180,000+ in annual sales
A connection service for all types of businesses — even startups.

Seek Business Capital loans
Finder Rating: 4.5 / 5: ★★★★★

Seek Business Capital loans
$5,000 – $500,000
Varies by lender
Personal credit of 680+, no bankruptcies in the last 4 years.
Startups and newer businesses could qualify for loans and credit cards with a custom financing package.

SmartBiz business loans
Finder Rating: 4.5 / 5: ★★★★★

SmartBiz business loans
$30,000 – $5,000,000
4.75% to 7%
640+ personal credit score, US citizen or permanent resident, 2+ years in business, $50,000+ annual revenue, no outstanding tax liens, no bankruptcies or foreclosures in past 3 years
Get funding for your small business with a government-backed loan and extended repayment terms.
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MREIDLs are currently the only SBA loans for service members

The Military Reservist Economic Injury Disaster (MREIDL) loan program is the only SBA loan program that's available to businesses that employ active duty service members.

  • Maximum amount: $2 million
  • Maximum term: 30 years
  • Rates: 4% or less on all loans
  • Eligibility requirements: Prove you don’t have the financial capacity to stay in business without SBA assistance, meet SBA credit standards and insurance requirements.

This SBA loan program was specially designed to help businesses stay afloat after a key employee is called to active duty. Businesses have up to a year to apply for this loan after the employee is called up.

It’s part of the SBA disaster loan program and is only meant to help your business survive the absence of that employee. You’ll want to look elsewhere if you need funds to grow or start a new business.

7 resources for veteran business owners

Business loans aren’t the only resources out there for business owners. If your business is owned by a veteran or member of the military, you might also want to take advantage of one of these programs.

SBA 8(a) Business Development program

The SBA 8(a) Business Development program is designed to give disadvantaged business owners a leg up in securing government contracts — including veterans. To qualify, business owners must be US citizens and have a net worth of $250,000 or less and under $4 million in assets. Your business must also be at least 51% owned and controlled by economically or socially disadvantaged individuals and meet the SBA’s size requirements.

The government reserves a separate pool of government contracts for 8(a) participants and the SBA helps business owners navigate the application process. SBA 8(a) participants also get assistance with management training, marketing, accounting, operational planning and more, as well as access to a mentorship program.

Office of Veterans Business Development

The Office of Veterans Business Development (OVBD) might be a good first stop for finding resources specifically geared toward veteran business owners. It offers information on different types of financing, grants and assistance programs that could help. You can also attend workshops and trainings at one of the many OVBD outreach centers across the country.

Service-Disabled Veteran-Owned Small Business program

The federal government sets aside at least 3% of its contracts for Service-Disabled Veteran-Owned Small Business program participants, cutting out a lot of the competition. To qualify, your business must be at least 51% owned and controlled by veterans with a service-connected disability, meet the SBA’s size requirements and have at least one service-disabled veteran managing daily operations and making long-term decisions.

Boots to Business program

Boots to Business is an entrepreneurial training program for transitioning service members and their spouses, including members of the National Guard and Reserve.

Participants can take part in a two-day, in-person course to learn the ins and outs of starting a new business. You also have the option of signing up for online courses on topics like business fundamentals and market research. You can register through the transition office of your military installation.

Women Veteran Entrepreneurship Training Program

The SBA funds several entrepreneurship training programs exclusively for women veterans. These are run by private organizations and include the Veteran Women Igniting the Spirit of Entrepreneurship program, the Entrepreneurial Program for Innovation and Collaboration, the Bunker in a Box program and the San Antonio Lift Fund.

They offer resources to train and mentor women veterans who want to start a business, as well as active-duty military and their partners.

Service-Disabled Entrepreneurship Development Training Program

The SBA also finances a few entrepreneurship training programs specifically for veterans with combat-related disabilities. These include the Entrepreneurship Bootcamp for Veterans with Disabilities, the Veterans Entrepreneurship Program, the Veteran Entrepreneurship Jumpstart Program and Dog Tag Bakery, Inc.

All offer training in starting and managing a business with the aim of giving service-disabled veterans a cutting edge.

Veteran Federal Procurement Entrepreneurship Training Program

Offered through the Veteran Institute for Procurement (VIP), this is a free three-day training program for veterans interested in starting a business that involves federal procurement. The program covers over 20 topics including contracting, accounting and teaming agreements. You can apply through the VIP’s website.

Bottom line

While the Patriot Express loan program is no more, there are options out there for veteran business owners. In addition to SBA loans, the government also offers a variety of resources for veteran entrepreneurs and business owners seeking an edge in a competitive market.

But you might not want to limit yourself to financing exclusively for veterans and military personnel — there’s a chance you’ll find a better deal elsewhere. Learn more about your options by reading our business loans guide.

Picture: Shutterstock

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