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How To Get A SBA Loan

Understanding how to get a SBA loan depends on what exactly you’re trying to accomplish. For example, are you trying to start a business? Refinance existing mortgage debt? Buy equipment for your existing business? Etc.

What you’re doing with the capital and the loan amount itself, it terms of the actual dollar amount, has a big impact on what banks you should approach and what type of loan documents you need to prepare. Most banks specialize in various types of SBA loan programs (for example, 7a’s, 504’s, or micro loans, etc) and have different levels of expertise within business types themselves. So finding a good match is essential.

How To Get An SBA Loan For The Purchase Or Refinance Of Commercial Real Estate.

SBA loans are one of the best ways to finance commercial real estate in the industry today. Due to the banking crisis, many banks still can not or do not want to lend to small businesses. The backing of the Small Business Administration helps banks make loans that they would never consider financing directly. For example, offering 90% or 80% financing is non existent today with out SBA backing.

How to Get An SBA Loan

Here’s a list of what you need to put together and provide banks.

Identify what the loan to value is going to be. On a purchase determine what your planning on coming in with. You’ll need an minimum of 10%. On a refinance try to get a REAL sense of what the building will appraise for. Try to identify other collateral you may have for the loan, such as your house.
Identify what issues are related to your loan request, if any and their potential solutions. Do you have “dings” on your credit? Low cash flow on a previous year? Issues with your existing lender, etc. Have solid explanations ready, both in writing and mentally. Deal with issues up front and reveal them early in the application process.
Put together your loan package, including: resume, 3 years of business tax returns, 3 years of personal tax returns, Personal Financial Statement, Business Debt Schedule, A/R & A/P Aging (to match balance sheet), year to date profit & loss and balance sheet on the business, purchase agreement, bank statements that shows where the money is coming from for the down payment, pictures of subject property.
Start calling banks to see what they are funding. How competitive they are. And if you feel that they are a good match for your situation.

Getting an SBA loan can be intense. Aligning yourself with a company that is aggressive and actively closing loans is critical. If you are in the process of purchasing or refinancing commercial real estate we’re interested in working with you. Please fill out our pre approval for to take the first step.

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