The U.S. Small Business Administration has introduced a 100-percent guarantee program for America's Recovery Capital loans, available to established, viable, for-profit small businesses that need temporary relief.

Small businesses that qualify may receive deferred-payment loans of up to $35,000 to help make their principal and interest payments on existing debt. This could cover mortgages, term and revolving lines of credit, capital leases, credit card obligations and notes payable to vendors, suppliers and utilities. The loans are interest-free and involve no SBA fees.

"These ARC loans can provide the critical capital and support many small businesses need to make it through these tough economic times," said SBA Administrator Karen Mills. "Together with other provisions of the Recovery Act, ARC loans will free up capital and put more money in the hands of small business owners when they need it the most. This will help viable small businesses continue to grow and thrive and create new jobs in communities across the country."

Loans will be distributed within six months. Repayment will not commence until 12 months after the final disbursement, when borrowers will pay back the loan principal over a period of five years, with no interest. The ARC program, which is part of the Recovery Act, was designed to help small businesses that struggle to make debt payments but have a history of good performance.

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