Small Business Administration (SBA) loans are an excellent source of financing for business owners looking to grow an existing business or start a new one. Though these loans are not directly issued by the SBA, the federal guarantee—of up to 85%—allows lending institutions to reduce their risk and offer these loans to small businesses at much lower rates and for longer terms than other kinds of financing.
The flexible terms associated with SBA loans allows businesses to use this funding for a variety of business needs including, daily operations expenditures, new hires, equipment purchases, real estate, expansion, and debt refinancing. With funding of up to $5 million and terms from 7 to 25 years, these can provide businesses with a critical investment while offering a more manageable monthly repayment.
Though an SBA loan is great once you’ve managed to obtain it, the downside is that applying for it is typically a long and relatively arduous process.
The application requires a great deal of paperwork and has to go through underwriting approval twice: first with your direct lender; and then, with the SBA. Both institutions must approve the loan before you can be certain of securing your funds.
In order to complete underwriting on your loan, here are a few of the documents you’ll be asked to submit:
Even with the long waits and document requirements, small business owners love SBA loans. The great terms, low rates, and more affordable monthly payments make these loans highly desirable for any discerning borrower.
* If you meet these general loan guidelines, you will most likely receive loan offers for this funding product. Loan offers are preliminary based on the information evaluated, final funding amount offer may be adjusted during final underwriting.
Not sure an SBA Loan is the financing solution for your business? No problem! Fimerica makes it easy to view and compare all of the business loans and financing products for which you qualify. Get your real-time loan offers in 5 minutes or less.less.