Small Business Loans (SBA)
There are a number of advantages to an SBA loan, including longer terms, no points and no balloon payments.
Who is Eligible for an SBA Loan?
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Most for-profit small businesses are eligible for an SBA guaranteed loan. This includes manufacturers, wholesale, retail and service businesses as well as independent or franchise businesses.
Loan Qualifications:
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Retail and service businesses with sales (3-year average) not exceeding $6 million to $20 million, depending on the industry
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Wholesale businesses with employees up to 100 regardless of sales volume
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Manufacturers with employees up to 500 depending on the industry, regardless of sales volume
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SBA 7(A) Loan Size $150,000 to $2.0 million
Loan Fees:
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Loan packaging fee: $750 to $2,000
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Fee is based on loan size, it is collected at the time of loan submission; refunded if declined by credit
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SBA guaranty fee: 1.70% to 2.60% of the loan amount
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Fee can be financed in the loan
Use of Proceeds:
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Commercial real estate (purchases, construction, or refinance)
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Leasehold improvements
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Business expansions
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Machinery, equipment, furniture or fixtures
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Business acquisition
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Working capital (offered in conjunction with some of the above)
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Start-ups (ALL Franchises, Motels, Restaurants Gas Stations and C-Stores)
Other Credits Considerations:
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Business must have adequate historic cash flow to cover the proposed debt
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Business debt to net worth must meet industry averages
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Borrowers must be actively involved in the day-to-day operation of the business
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Satisfactory personal credit histories are required for all principles and guarantors
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No past bankruptcies or felony arrests