Citizen’s Bank makes SBA ARC loans impossible to qualify for

June 19, 2009

This is the last straw.

The only reason why I stay with the same bank even after they continue to drop the ball on a regular basis is for the same reason you don’t change lanes in rush hour traffic. No matter where you go it’s just going to be a lateral move. You’d think after 6 years they’d finally consider one of their business customers worth doing business with.


So just to let every small business know the SBA has an ARC LOAN that’s part of the stimulus bail-out that no one but the wealthy seem to be benefiting from….UNTIL NOW I thought with this ARC LOAN.

Citizen’s Bank supposedly deals with the SBA and they claim to be one of their biggest lenders. It’s only $35K at most so this is not some crazy amount of money. More like just enough to keep things from going sour.

Here’s what the SBA claims you need to qualify:

ARC Loan Eligibility

ARC loans are available to viable, for-profit small businesses in the U.S. that have qualifying small business loans and are experiencing immediate financial hardship.  

Your small business must be an established business, have financial statements demonstrating it was profitable in one of the past two years, and be able to project sufficient cash flow to meet current and future loan payments over a two-year period from loan approval.  If your business does not meet these criteria, you can discuss your eligibility with your lender.  ARC loans are not designed for start-up businesses.  

Applying for an ARC Loan

ARC Loans are provided by commercial lenders and guaranteed by the SBA.  Your next step is to contact your lender who will help you determine if you are a candidate for an ARC Loan.  Questions they may ask include the following:

  • Does your small business have an established banking relationship?
  • Has your small business been in operation for a minimum of two years?
  • Do you have financial statements (balance sheet, income statement, and cash flow statement) which demonstrate your business had a positive cash flow in one of the past two years (or as long as your business has been operating, if less than two years)? 
  • Does your cash flow projection for the next two years indicate sufficient cash flow to meet your current and future loan payments?
  • Is your business suffering an immediate financial hardship?  For example:
  • Declining sales and revenues;
  • Difficulty in making loan payments on existing debt;
  • Difficulty in paying employees;
  • Difficulty in purchasing materials, supplies, or inventory; and/or
  • Difficulty in paying rent and/or other operating expenses.

So finally it looks like staying with these humps has finally paid off. Long term relationship with a bank REGARDLESS of prior hardships, established business that makes money (usually) and I seem to quality.

Nope. Don’t qualify. They don’t give GOVERNMENT BACKED LOANS to anyone that doesn’t have loans with them to begin with. As in they want to convert THEIR loan into a “bail out loan” completely disregarding the entire purpose of this BAIL OUT. A loan with a high interest rate on the other hand was seemingly available although it wasn’t when I went to them a couple years ago(….hmmm seems I’d qualify if they’d actually had done their job back then…what a nightmare). I’m looking for some relief and this guy is looking to make money off of me.

Grotesque to the point that I was getting chills by the way this guy just had no intention of providing any help. Just business as usual as I’m sure that no matter what my situation was there’d be no “ARC LOAN” but it’d be a small business loan that they’d make money off of…actually I believe they do make money off of the ARC loan and the interest is paid for by the government (tax bail-out money) so it’s even more disturbing that they’d take this route.

So the Government is providing relief and Citizen’s Bank is using the opportunity to work the old “bait and switch” technique. Wow, people in a position of making decisions completely out of touch with reality. Why does this not surprise me?

I really hope there is a bank left in my area that is willing to provide legit business instead of trickery and scam tactics. I unfortunately have no faith after seeing how sleazy some do business with people that are looking for help.





Well, according to the rules of who actually qualifies for this ARC LOAN this would make you NOT eligible:

“ARC loans can not be used to make payments on another SBA-guaranteed loan, with the exceptions of loans made with an SBA guaranty after Feb. 17, 2009”

And to continue with the confusion, according to them (the bank) you need to have delinquent loans (on top of it being theirs) but again the wording on how this loan is the EXACT OPPOSITE:  

  Also, the borrower must certify that they are currently no more than 60 days past due on any loan being paid with an ARC loan and they must have an acceptable business credit score as determined by SBA.

If you are delinquent then you won’t have a good credit score therefore disqualifying you from getting the loan.


Banks once made money via loans. Now they make money via HORDING and ripping people off and this isn’t even their money! This money is provided to the small businesses via TAX PAYER MONEY yet the banks seem to make up any reason to not provide them. How this is legal I have no idea.

I hope someone from the SBA will read this and maybe inform these approved lenders that they might want to get their acts together.

I have zero faith unfortunately.



  1. Your words are so true. My small business is jumping through flaming hoops to get back on our feet but the lenders/banks just sit back and cherry-pick who they WANT to give loans to, instead of who QUALIFIES.

    I feel your pain, man. Please keep us updated.

  2. Citizens Bank is a horrible… I found myself often wondering why I am still banking with them after the closed all the convent banks….THEN they “dropped the ball” big time…and I am paying heavily for it…. I loath this bank…they have very poor management also and seem to be competent when conversing with them but when it comes down to real knowledge on their actual job…they are morons

  3. My company has been profitable for 18 years. This year, we have so far lost $91,000—- and counting. My bank, (Harris) told me we don’t qualify for an ARC loan (after 2-1/2 months of give me this, give me that ) because our business cash flow projections indicate that we’ll be able to pay back an interest bearing loan and “don’t need” an ARC loan. So because we have been diligent and have come up with a plan to cut expenses in the face of a 50% reduction in sales, we “don’t qualify”. I guess if you are on the verge of bankruptcy but can come up with a projection that shows you can pay back the loan and make no more than a dollar a year doing it, you’re in. By the way, they, too, offered “all I could eat” interest bearing financing.

    When you look at it, though, the govt requirements are impossible to meet. You have to have been profitable and now you’re not, and you have to be able to pay it back, but almost not be able to pay it back. Sounds like it all boils down to manipulating the projections correctly.

  4. You could not be more correct. The only way one would qualify (thanks to the banks having their own stipulations) is if you are defaulting on one of THEIR loans and they are looking to switch you to a loan that they are guaranteed payment via Obama and Friends when you stop paying…which they want you to do cause you need to be behind on the payments to begin with to get the loan.

    Yeah, so this is more BANK BAILOUT disguised as a SBA loan. Why does this surprise us again?

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