SBA Loans
An SBA loan, is a loan backed by the Small Business Administration (SBA), ensuring loans provided by SBA-approved lenders to small businesses. Among its various loan programs, the SBA’s most popular is the 7(a) loan. At Peoples Bank, we specialize in 7(a) loans. Essentially, an SBA loan is a standard small business loan with a portion guaranteed by the SBA.
Determining if an SBA Loan Suits Your Business The suitability of an SBA loan for your business hinges on your specific circumstances. The SBA 7(a) loan is tailored for small business owners who face difficulties securing a conventional bank loan. Common challenges include the need for lower payments, insufficient down payment, or inadequate collateral. If these issues resonate with you, an SBA loan could be an ideal solution for financing your business’s start-up or growth.
Benefits of an SBA Loan An SBA 7(a) loan guarantee allows approved lenders to offer loans to less qualified borrowers under more favorable terms, similar to those of standard bank small business loans.
These favorable terms include:
- Extended Amortization Periods
- Reduced Cash Flow Requirements
- Lower Down Payments
- More Lenient Collateral Requirements
Applications of an SBA Loan SBA 7(a) loans are versatile, useful for various purposes such as working capital, purchasing equipment or inventory, acquiring real estate, constructing new facilities, or refinancing existing business debt.
Loan Terms for SBA Loans:
- Up to 7 Years for Working Capital
- Up to 10 Years for Machinery & Equipment
- Up to 25 Years for Real Estate
While SBA loans offer favorable financial conditions to aid small businesses in accessing necessary capital, they don’t negate the need for a solid business plan and good credit. The SBA mandates that borrowers either have a proven track record (for existing businesses) or a viable business plan (for start-ups), along with strong credit for both the business and its principal owners. If these requirements are a concern, contact us for an assessment of your eligibility for an SBA loan, or for guidance on how to meet these criteria.
To learn more about an SBA loan, please contact us or give us a call today at (843) 606-6058 or toll-free at (855) 406-0197 for a free consultation and see if an SBA loan is right or you!