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SBA Loans

Revenue Based Financing Merchant Cash Advance Invoice Factoring Asset Based Loans Business Loans Business Line of Credit SBA Loans

Introduction

When your business needs reliable funding with favorable terms, SBA Loans are a great solution. These loans are designed to support small businesses with competitive rates, long repayment terms, and lower down payments. Another advantage of SBA Loans is the variety of programs available to meet different business needs, from working capital to purchasing real estate and equipment. These loans are partially guaranteed by the Small Business Administration (SBA), making them more accessible to small businesses.


What Is An SBA Loan?

An SBA Loan is a loan provided by an approved lender, partially guaranteed by the SBA, which helps reduce the lender’s risk and makes it easier for small businesses to qualify. SBA Loans can be used for a variety of purposes including working capital, purchasing inventory or equipment, refinancing existing debt, or buying real estate. SBA Loans are an excellent option for businesses that might not qualify for traditional loans due to limited operating history, lower credit scores, or lack of collateral. The SBA guarantee reduces the risk for lenders, allowing them to offer more favorable terms to small businesses.


Types of SBA Loans


7(a) Loan Program

The most popular SBA loan program, providing up to $5 million for various business needs including working capital, expansion, and equipment purchase.

504 Loan Program

Provides long-term, fixed-rate financing for major assets such as real estate or large equipment. These loans are typically structured with a private sector lender and a Certified Development Company (CDC).

Microloan Program

Offers small, short-term loans up to $50,000 for working capital or purchasing inventory, supplies, furniture, fixtures, machinery, and equipment.

Disaster Loans

Provide financial assistance to businesses affected by declared disasters to help them recover.

SBA Express Loans

Provide faster access to capital with less paperwork. These loans have a maximum loan amount of $500,000 and offer a quick turnaround time, typically within 36 hours.


Eligibility Criteria

  • The business must operate for profit.
  • The business must be considered a small business as defined by SBA.
  • The business must operate in the United States or its territories.
  • The business owner must have invested their own time or money.
  • The business must not have access to other financing on reasonable terms.

Application Process


Step 1: Determine Eligibility

Review the specific eligibility requirements for the type of SBA loan you are interested in.

Step 2: Gather Documentation

Prepare the necessary documents including a business plan, financial statements, tax returns, and details on the loan purpose.

Step 3: Choose an SBA-Approved Lender

Select a lender experienced with SBA loans to guide you through the process.

Step 4: Submit Application

Complete the loan application and submit it along with your documentation to your chosen lender.

Step 5: Lender Review

The lender will review your application, conduct a credit check, and possibly request additional information.

Step 6: SBA Approval

If the lender approves your application, it will be submitted to the SBA for final approval.


Loan Terms and Conditions


Interest Rates

Typically lower than conventional loans, with both fixed and variable rate options.

Repayment Terms

Longer repayment terms up to 25 years, depending on the loan type.

Loan Amounts

Vary by loan program, with 7(a) loans up to $5 million, SBA Express Loans up to $500,000, and microloans up to $50,000.

Collateral

Generally required for loans over $25,000.


FAQs


1. What types of SBA loans are available?
There are several types, including the 7(a) Loan Program, 504 Loan Program, Microloan Program, Disaster Loans, and SBA Express Loans.
2. Who is eligible for an SBA loan?
Eligibility criteria include operating for profit, meeting SBA size standards, doing business in the U.S., having invested equity, and exhausting other financing options.
3. How do I apply for an SBA loan?
Determine eligibility, gather required documents, choose an SBA-approved lender, submit your application, and await lender and SBA approval.
4. What documents are required for an SBA loan application?
Commonly required documents include a business plan, financial statements, tax returns, and details about the loan's purpose.
5. What are the interest rates and terms for SBA loans?
Interest rates are typically lower than conventional loans, with both fixed and variable rates available. Repayment terms can be as long as 25 years, depending on the loan type.
6. How much can I borrow with an SBA loan?
Loan amounts vary by program: up to $5 million for 7(a) loans, $5.5 million for 504 loans, $50,000 for microloans, and $500,000 for SBA Express Loans.
7. Do SBA loans require collateral?
Collateral is generally required for loans over $25,000, but the SBA does not decline applications solely for lack of collateral.
8. How long does it take to get an SBA loan?
The application process can take several weeks to months, but SBA Express Loans offer a quicker turnaround, typically within 36 hours.
9. Can I use an SBA loan to refinance existing debt?
Yes, SBA loans can be used to refinance existing debt under certain conditions.
10. What happens if my SBA loan application is declined?
If declined, you may explore other financing options or address issues that led to the denial and reapply.

For specific details and guidance, contact us or visit https://www.sba.gov/funding-programs/loans


Example of an SBA Loan

Your business applies for an SBA 7(a) Loan from Signet Capital Group. Your application is approved, and you receive a loan of $250,000 with an interest rate of 6% and a repayment term of 10 years. With these favorable terms, you use the loan to purchase new equipment and expand your operations.
How to Apply for an SBA Loan:

  • Contemplate Your Needs: Evaluate if an SBA Loan suits your business’s needs.
  • Collect Your Documents: Gather required documents like a business plan, financial statements, and tax returns.
  • Fill Out Our Online Application: Provide basic information and your desired funding amount.
  • Speak to a Representative: Discuss your needs, the loan process, and ensure all necessary documents are submitted.
  • Receive Approval: Get approval within a few weeks, with funds disbursed shortly after.

If you’re declined, our team will help you explore other financing options that may be more suitable for your business’s current financial situation.

How To Apply

Our application process is fast and easy, taking just a few minutes to complete, and funds can appear in your bank account in as few as 1-2 business days from approval. Here is how to apply:

Step 1: Contemplate Your Needs

Before you apply, make sure that the funding program is the right solution for your business's needs. Consider whether you will be able to use the funds for your desired purpose, and if the repayment structure is conducive to your cash flow. Take your time to determine the amount of funding your business will most benefit from.

Step 2: Collect Your Documents

Here is what you will need to submit with your application:

  • A valid driver’s license
  • 1 voided business check
  • Past 4 months of bank statements
  • Past 4 months of credit card processing statements

Step 3: Fill Out Our Online Application

To start the application process, give us a call or fill out our short online application. We will ask you to provide some basic information, along with your desired funding amount.

Step 4: Speak to a Representative

Once you apply, a representative will reach out to you, so make sure you have all your documents ready from 'Step 2'. The representative will explain the repayment structure, rates, and terms you qualify for. This will ensure that there are no surprises or hidden fees during repayment. Once you decide, you will be given a final application to submit along with your documents.

Step 5: Receive Approval

If you’ve been approved, you’ll hear back from us within 24 hours. Funds should then appear in your bank account in 1-2 business days.

What If I’m Declined?

Your application may be declined if your business’s cash flow is insufficient at the time of your application. This product places an emphasis on monthly revenue, so applicants with strong sales in the previous 4 months are more likely to receive approval than those without. You may also be asked to provide statements going back farther, even from a previous year.

In some cases, we may conclude that taking on more debt would do more harm than good for your business. In this case, we might recommend a different, more affordable business financing tool. At Signet Capital Group, we can help you explore your options and point you in the direction of the most sensible choices.

Complete the application
Fill out some basic information about your business for a quick decision
Approval in less than 2 hours
We match you with a funding solution that best fits your needs
Same-day funding
Be approved and get the funds transferred to you in as little as 2 hours

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