Turning to their local credit unions, military personnel aretransitioning back into civilian life by starting up businessessuch as chiropractic firms, franchise restaurants and even shoestores.

Some are also taking skills they've learned to becomeentrepreneurs and in the process are also helping to boost thepopularity of a government program that provides special loans tohelp them start and expand their businesses.

Launched in June 2007, the SBA's Patriot Express programprovides loans up to $500,000 with an interest rate generally from2.25 to 4.75 points over prime depending upon the size and maturityof the loan. Those eligible for the loans include veterans, theirspouses and persons in active duty who qualify for the military'stransition assistance program.

The SBA said Patriot Express loans are in such demand that theinitiative was recently renewed for three more years. More than$560 million in loans have been approved to nearly 7,000 veterans,reservists and their spouses.

“The impact of this program over the last three-and-a-half yearshas meant thousands of veterans and their families have had theresources to pursue their dreams as entrepreneurs, and at the sametime create jobs and drive economic growth at a critical time forour country,” said SBA Administrator Karen Mills.

Credit unions have aided in that growth through theirparticipation in the Patriot Express program. Fifty-five of themhave approved roughly $38 million in loans as of Sept. 30,according to SBA data.

Leading the way is the $4 billion Randolph-Brooks Federal CreditUnion in Live Oak, Texas, with more than $9 million in loansapproved. Founded in 1952 to serve Randolph Air Force Base andshortly after, Brooks Air Force Base, the cooperative still hasstrong ties to the military community even though it has sinceexpanded to serve more than 1,900 select groups and eightunderserved communities in the San Antonio and Austin areas.

“It's a good program. It benefits those who have served ourcountry and there's also benefit to lenders through the higherguarantees. So, it's a win, win,” said Kenan Pankau, SBA programmanager at Randolph-Brooks.

Named the top credit union 7(a) program lender in 2009,Randolph-Brooks has more than $20 million in SBA loans. Pankau saidas soon as the agency rolled out Patriot Express in 2007, thecredit union immediately signed on. Since then, some of the loanshave helped fund franchise businesses while others have expandedmature companies started with skills learned in military careers.Pankau said it might be hard to pinpoint the average loan size butthe working capital lines of credit offered tend to fall in the$35,000 to $50,000 range.

“We're seeing a nice mix. Many of them are transitioning out ofthe military. Even in the San Antonio area, we serve a lot ofretirees and there are other businesses located here that serve themilitary,” Pankau said.

The Patriot Express loans can be used for most businesspurposes, including startup, expansion, equipment purchases,working capital, inventory or business-occupied real-estatepurchases, according to the SBA, with most applications approvedwithin 24 hours. The loans can also be used to recover fromdeclared disasters, to sell goods and services to the governmentand to prepare a business in the case the owner is deployed.

For the $43 billion Navy Federal Credit Union, 80% of the loansare being used to launch brand new businesses, said Rick Cole,credit underwriter at the Vienna, Va.-based cooperative. Withnearly $2.5 million in Patriot Express loans approved, it is thesecond largest credit union lender in the program. There's another$1 million in the pipeline, according to Cole.

“I think the primary motivation and the reason why the programhas been so successful is because it fits perfectly with ourmembership,” Cole said. “It's designed to help military memberstransition into private life.”

Most of Navy Federal's loans range between $100,000 and$300,000, Cole said. Given the credit union's expansive reachnationwide, some of the funds have been used to start businesses instates such as Connecticut, California, Texas and the Atlantametropolitan area. They run the gamut from technology firms tochiropractic offices, shoes stores and franchise restaurants.

Cole acknowledged that most applicants don't come in looking forthe Patriot Express loans. If they don't qualify under normal loancriteria, the SBA gives added security to those who would nototherwise be eligible, he said.

Several other credit unions have been just as active with loanapprovals, including the $2.8 billion Redstone Federal Credit Unionwith $1.85 million approved and the $215 million Self-Help CreditUnion at $1.28 million loans approved. Vantage West Credit Unionand Centris Federal Credit Union have approved $1.28 million and$1.19 million in Patriot Express loans, respectively.