SBA Loans Can Help Your Business Qualify For Financing More Easily And With More Flexible Terms Allowing Your Business To Preserve Valuable Working Capital For Other Expenses.


Reduced Underwriting Requirements For Higher Loan Amounts & Extended Terms

What is An SBA Small Business Loan?

SBA loans are small business loans made through banks, credit unions and other lenders who partner with the SBA. SBA loans are designed to help borrowers who may not meet the lending standards set by most banks by providing a government-backed guarantee on part of the loan which reduces the risk for the lender and makes approvals easier and with more flexible terms.

The SBA loan programs are available to both new and established businesses with the primary objective being to enable loans for longer repayment periods because of the looser underwriting criteria due to the SBA guarantee. However, these programs can also enable owners with bad credit to qualify for a term loan they may not have otherwise been able secure.

With SBA loans, a business can qualify even if the yearly payment approximates previous year's profit while most traditional banks require the annual payment for loans to be no more than two-thirds of prior year's operating profits. The lower payments, longer terms and loosened underwriting guidelines also increase the amount that can be borrowed under the SBA programs.

The SBA Loan programs available include:

  • 7(a) Loan Guarantee Program
  • 504 Fixed Asset Financing Program
  • MicroLoan Program

Requirements for an SBA Loan Application are significantly more in terms of paperwork, forms, and disclosures than a traditional bank term loan, so, if you can't document sound financials for the business, a Revenue Based Loan such a Merchant Cash Advance may be your only option.


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"An SBA Small Business Loan Has a Government Backed Guarantee Which Makes Qualification Easier and Maximizes the Potential Loan Amount & Payment Term!"

Compare SBA Small Business Loan Programs

Loan Guarantee, Fixed Asset Financing & Microloan Programs

The most popular of the SBA Loan Programs is the SBA 7(a) General Small Business Loans. The SBA 504 loans are generally used for new construction and real estate acquisition or renovation; and the Microloan Program is similar to the 7(a) General Business Loans, but limited to a maximum of $50,000.

Following is a comparison of the available SBA Loan Programs: :

SBA 504 SBA 7(a) SBA Microloan
  • Purchase of new equipment or real estate
  • Construction and renovation
  • Purchase or expand a business
  • Purchase equipment or inventory
  • Working capital
  • Refinance debt
  • Working capital
  • Purchase equipment
  • Purchase vehicles or inventory
  • Amount Up to $5 million Up to $5 million Up to $50,000
  • Up to 2 years interim construction period
  • 7-10 years on equipment
  • 10-20 years on real estate
  • Up to 7 years for working capital
  • Up to 10 years for equipment or business acquisition
  • Up to 25 years for real estate
  • Up to 6 years
  • Eligibility
  • Operate as a for-profit company
  • Do business (or propose to) in the United States or its possessions
  • Has a tangible net worth less than $15 million and an average net income less than $5.0 million after taxes for the preceding two years.
  • Loans cannot be made to businesses engaged in speculation or investment in rental real estate.
  • Be an eligible type of business. While the vast majority of businesses are eligible for financial assistance from the SBA, some are not. Check this list of eligible and ineligible types of businesses to see if your company qualifies.
  • Under the 504 Program, Plan to use proceeds for an approved purpose. CDC/504 loan proceeds may be used for the financing of fixed assets like real estate or equipment. This list explains Eligible and Ineligible Use of Proceeds.
  • Not have funds available from other sources. SBA does not extend financial assistance to businesses when the financial strength of the individual owners or the company itself is sufficient to provide all or part of the financing. Both business and personal financial resources are reviewed as part of the eligibility criteria. If these resources are found to be excessive, the business will be required to use those resources in lieu of part or all of the requested loan proceeds.
  • Ability to repay the loan on time from the projected operating cash flow of the business
  • Good character. SBA obtains a "Statement of Personal History" from the principals of each applicant firm to determine if they have historically shown the willingness and ability to pay their debts and whether they have abided by the laws of their community
  • Relevant management expertise
  • Feasible business plan
  • Operate for profit
  • Be small, as defined by SBA
  • Be engaged in, or propose to do business in, the United States or its possessions
  • Have reasonable invested equity
  • Use alternative financial resources, including personal assets, before seeking financial assistance
  • Be able to demonstrate a need for the loan proceeds
  • Use the funds for a sound business purpose
  • Not be delinquent on any existing debt obligations to the U.S. government
  • Each intermediary lender has its own lending and credit requirements. Generally, intermediaries require some type of collateral as well as the personal guarantee of the business owner.


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