Our Top SBA Loan Resources
So you want to know how you can get an SBA loan to start or grow your dream business? This ultimate SBA loan guide is one of our most popular resources for entrepreneurs like you who are looking for proven and reliable business funding resources. Let’s get started!
What Exactly Is An SBA Loan?
There are a number of online SBA loan resources, including our website. But while there are a number of SBA information websites there are few services that actually help entrepreneurs get qualified and approved for SBA loans.
You have probably heard that SBA loans are very popular funding options for small business owners who want working capital, acquisition loans, or to simply grow. This is true!
SBA loans are very popular options for small businesses to obtain capital to start, acquire and grow.
So, what exactly is an SBA loan? In this resource, we will cover SBA loan costs, qualifications, use of proceeds, and where to find SBA lenders to help you determine if an SBA loan is best for you.
SBA Loan Basics
Contrary to popular belief, an SBA loan is a government-guaranteed small business loan that is actually given by a regular bank. The immediate benefits are that SBA loans have defined and long terms, relatively love interest rates, and are generally available to a larger range of businesses than most traditional bank loans.
The Small Business Administration (SBA) is the government agency that guarantees a part of all SBA loans that banks lend to business owners. The SBA was founded in 1953 to support the many needs of small business owners across the United States.
Why SBA Loans?
So why are SBA loans so special for small business owners? A few reasons:
- Long terms: SBA loans have terms, or payback periods, that range from 10 to 25 years (compared to just 12-60 months for many typical small business loans).
- Low interest rates: SBA loans have low interest rates that typically track the prime rate.
- Flexible use of proceeds: You can use SBA loans for a number of business uses, including working capital, equipment purchases, refinancing debt, purchasing inventory, or acquiring a new business.
Why Do Banks Like SBA Loans?
The reason why so many people mistakenly assume that the SBA gives out the loan The most common misunderstanding about these loans is that the agency lends money directly to small businesses.
However, the agency does not typically make direct loans. The SBA provides a guarantee on the loan, promising to reimburse the bank for a certain percentage of the loan if there is a default.
This guarantee lowers the risks to lenders, encouraging them to offer these loans to more American small businesses. Many banks and other financial institutions offer SBA loans, but their process, requirements, and fees can vary.
Applying for SBA Loans
Up until recent technology developments, small business owners only had one option to get SBA Loans…they had to walk into a bank and apply with a banker. But this was a very limiting and time-consuming approach since banks have varying criteria…and while one bank may have turned you down, the bank next door may have given you a loan without a hitch.
That meant it was VERY time consuming, confusing, and even frustrating to find a good local bank that would underwrite SBA loans.
So what’s different now?
SBA Loan Brokers
We have partnered up with several SBA lending partners and brokers that do exactly this: Help entrepreneurs get SBA loans. Here are a few that we recommend (note they are also partners of StartFundGrow.com).
SmartBizLoans is one of our SBA lending partners that brings growing companies from application to close, quickly and easily. If you have been in business for 2+ years, have a 680+ credit score, and have a good fundamental business, apply today for an SBA loan from SmartBizLoans.
In their own words:
“In fact, SmartBiz has created the first online marketplace of preferred SBA lenders for small businesses. With multiple banks with varying credit requirements on our platform, we’ve been able to help many applicants successfully apply for an SBA loan who were initially rejected by their local banks. What’s our secret? It’s no mystery; our sophisticated software allows us to match borrowers with the bank most likely to approve and fund their loan. Rather than spending your time going from bank to bank, SmartBiz can help you successfully apply for a loan quickly and efficiently.“
Guidant Financial is a trusted resource for a variety of business loans and startup funding, including SBA loans, 401k loans, real estate loans, and more.
In their own words:
“Guidant Financial makes it easy for qualified borrowers to obtain an SBA loan. Our streamlined process gives you immediate access to lenders with just a single loan application. With our comprehensive loan package analysis, we ensure you’re matched with the lenders who provide the best loan rates and the greatest chances of approval. Guidant clients have a 96 percent funding success rate once a loan offer is secured from a lender
Not only will we help you find the lender that’s right for you, but we’ll provide overall guidance through the SBA process and in-depth document review to ensure you have everything in line for approval.“