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SBA 7(a) Loan Information

It’s commonly believed an SBA loan from one lender is nearly identical to an SBA loan from another lender.

That could not be further from the truth. The SBA program has minimum guidelines that all lenders must adhere to but once those standards are met lenders quickly differentiate themselves on pricing, terms and other factors based on how aggressively they are willing to lend.

We help you determine which lender is best for your business loan.

SBA 7(a) loans offer competitive loan terms, lower down payments and require less collateral than other loan options.

The loan proceeds can be used for various purposes including:

  • Business Startup/Acquisition/Expansion
  • Refinancing Existing Debt
  • Working Capital
  • Equipment Purchase
  • Construction
  • Partner Buyout

SBA Lender Differences

Interest Rates — The interest rate on most SBA loans floats at WSJ Prime plus a margin; lenders have great flexibility in determining that margin
Underwriting — The portion of an SBA loan which is not guaranteed by the U.S. government (typically 25%) is carried on the lenders’ balance sheet as other conventional loans are. Each lender has a unique risk tolerance for the non-guaranteed portion of the SBA loan which governs how flexible their underwriting process is and what interest rate they charge.
Efficiency — Just because a lender offers the SBA program does not mean they have developed an efficient process to engage, underwrite, close and service their business loans. Additionally, the borrowing experience within each lender can change dramatically depending on the individuals and teams involved.