An SBA loan is a loan issued by a traditional lender or alternative finance company that is backed by a guarantee from the U.S. Small Business Administration. An SBA loan is a low-interest, government-backed loan. SBA loans give you the longest term, lowest rates, and are repaid monthly. There are four different types of loan guarantee programs through the SBA: 7(a) loans, CDC 504 loans, micro-loans and disaster loans. Because of their federal guarantee, SBA loans are the lowest cost long-term funding available to small businesses. Before the involvement of alternative finance in the SBA market, getting an SBA-guaranteed loan was a lengthy, cumbersome process, which has now been simplified. Businesses that have been in business for at least two years are eligible. Collateral can be required for loans of more than $25,000 in some situations.
Funding time
2-4 Weeks
Amount
$5 Million
Payments
Monthly
Terms
5-10 Years
How Can i Use My SBA Loan?
You can use the proceeds of an SBA loan for short- or long-term working capital, including seasonal financing, construction financing and inventory. To buy equipment, real estate, or to renovate existing real estate. You cannot use an SBA loan to refinance existing debt or to pay delinquent taxes.
How Do i Get An SBA Loan?
Alternative lending has streamlined the application process for all kinds of funding. SBA loans, however, do have a higher threshold for approval than other types of funding. You must be in business for a minimum of two years and be a U.S. citizen or legal permanent resident. Not every kind of business is eligible; please check the SBA’s requirement list before you apply. You must have no bankruptcies in the last three years and no defaults on government-backed loans.
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