The Small Business Association offers a variety of loans for business with varying terms and APR. Funds can be used for anything from the purchase of equipment to construction, and inventory. The SBA provides specific requirements to be considered a “small business” and eligibility is determined based on the ability to provide proof of those requirements.
The immense benefit of this financing is that the SBA will guarantee a percentage of these loans to the lender. This provides a significant measure of security for guaranteed repayment. As a result, financial institutions have more incentive to lend money to these qualified small businesses.
SBA Real Estate Loan
When purchasing Owner Occupied space for a business, a Real Estate SBA Loan is the best business option for financing. A fixed rate SBA 7(a) Loan provides up to 90% financing, with low down payment requirements for business owners looking to purchase a multi-use space.
Eligible businesses must meet a number of requirements:
- The business must operate for profit
- Must be defined as “small” according to SBA guidelines
- Be located in, or doing business in, the United States
- Must have sufficient equity
- Before applying, applicants must have exhausted all financial resources, including personal assets
- Must not be delinquent on any existing debt to U.S. government
SBA 7(a) loan proceeds can be used for financing many different business needs. There are restrictions on how the funds are used. For example, applicants may not use funds as an asset for potential increased value or for reimbursement of funds used for the business previously.
SBA Equipment Loan
A SBA 504 Loan is a perfect option for small to mid-size business owners looking to obtain funding for machinery and equipment. Equipment loans are typically funded for 80% up to 100% of the equipment purchase price. Qualifying purchases will have long-term value and will be used solely for business purposes.
In order to be approved for a SBA 504 Equipment Loan, a business must provide proof of experience and show a need for the equipment being purchased. When a business is denied a typical loan, a SBA 504 loan provides funding with low APR and easy terms.
SBA Inventory Loans
A SBA 7(a) Inventory Loan is typically used for the purchase of inventory and / or stock in order to meet business requirements. Future income is used as collateral in this case, and the loan is paid as inventory is sold.
Our SBA 7(a) loans feature easy terms and low APR. In order to qualify for a SBA 7(a) Inventory Loan, a business will be required to show proof of experience and records or sales/ income for prior years.
SBA Business Acquisition Loan
A SBA 7a Business Acquisition Loan provides funding for the purchase of an existing business. By leveraging capital, business owners can obtain funding with low APR and no collateral. A business acquisition loan is typically funded for up to 90% of the purchase price.
To qualify, applicants will typically need to provide a current balance sheet with P&L statement, two years federal income tax returns, BOS including Terms and asking price of business to be purchased. Loan proceeds cannot be used to purchase assets for their potential increased value or as owner reimbursement.