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SBA Loan Packaging

Here we answer:  What is SBA loan packaging?  How much does it normally costs, and why do you have to pay it?

 

What is SBA Loan Packaging

There's a lot of paper work that goes into submitting a full loan application to the SBA. And this is in addition to the basics SBA formsand financials that borrowers have to fill out/provide to banks.  The write ups that banks have to submit to the SBA are extensive and extremely detail oriented.  Organizing all of this information can be incredibly time consuming and draining on banks back offices. 

It's detailed work that requires a lot of follow up with borrowers to provide the requested info.  Most borrowers get frustrated with the process and reist submitting all of it.  Without someone really being persistent and staying on top of the borrower, deals can sit there and rot.  So many banks hire out this critical step to professionals that specials in this particular part of the process. 

How Much Does SBA Loan Packaging Costs

The cost often ranges on the complexity of the project but the minimum is normally $1,000 and the max per the SBA rules is $2,500.  This fee is paid by the borrower before the loan receives a commitment and is not refundable regardless if the loan closes or not.  The only exception to this is if the packaging company doesn't start the project, but has already been paid. 

SBA loan packaging is a necessary evil to the loan process.  Without the aid of a third party company, to do this tidous work, loans don't close.   Borrowers often think its just a junk fee but the reality is the opposite.     

 

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