"This program has turned out to be a blessing for us," Udi Hershkovitz said Wednesday.
Without it, Signature Bank Vice President Burton Blackmar said, the FuegoMundo deal "would have been a lot more difficult."
Udi Hershkovitz said he had no idea how tough financing would be when the couple embarked on their idea, which came to them during a South American vacation.
They had a track record of success, having run three profitable Subway sandwich shops. They had excellent credit. And they had a bank that knew them. But that bank ran into financial troubles, and the loan they expected fell through.
That left them with a restaurant under construction and not enough money to finish. They talked with 10 to 15 banks, but were rejected by all.
"It was almost like a moratorium," Udi Hershkovitz said, noting that banks wanted collateral equal to the amount he was seeking — a half-million dollars.
The stimulus program took effect in March, and Signature agreed to lend to FuegoMundo shortly after. The loan is 90 percent guaranteed by the SBA.
That "extra security," said SBA district director Terri Denison, lessens lenders' exposure and stimulates lending. The $12,000 saved on fees, said Udi Hershkovitz, "is substantial for a startup business."
Kelly McCutchen, executive vice president of the Georgia Public Policy Foundation, a market-oriented think tank, said "some sort of incentives are fine." But, he said, the loan guarantee percentage is too high because it puts taxpayers at too much risk.
Denison said the number of SBA guaranteed loans under the stimulus program is up 35 percent in Georgia since mid-March, when the program was launched, compared with the January to mid-March time period. "We are starting," she said, "to see positive effects."