Frequently Asked Questions

 

Do all SBA lenders offer the same SBA loan options?

What businesses can qualify for a SBA loan?

How can the loan proceeds be used?

What terms are available with an SBA loan?

Are there fees for borrowing through the SBA?

Can SBA loans be re-paid at any time?

What are the main types of SBA loans?

How long does it take for an SBA loan to close?

 
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If a piece of land is purchased and then planning approval to develop it into houses is acquired, would that business qualify for an SBA loan?

 

Do all SBA lenders offer the same SBA loan options?


No, because SBA loans must be approved first by the issuing bank, each financial institution issuing SBA loans can choose which programs they offer, as well as determine various lending criteria such as the maturity terms or the loan amounts they offer.

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What businesses can qualify for a SBA loan?


Many businesses today qualify to apply for an SBA loan. A business must be a for-profit business, do business in the United States, have a sufficient amount of owner equity to invest in the business, and have already used other financial resources first, including personal assets.

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How can the loan proceeds be used?


SBA loans can be obtained for a variety of business uses such as: buying commercial real estate, new construction, renovation of existing properties; starting, expanding or acquiring a business, buying fixed assets such as fixtures, machinery, and equipment; inventory; and working capital.

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What terms are available with an SBA loan?


Usually, SBA loans are obtained to provide longer-term small business financing. Actual loan maturities are established by the lending institution, business' ability to repay the loan, the purpose of the loan, and the expected ongoing value of collateral or assets.

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Are there fees for borrowing through the SBA?


To cover the costs of the administering the SBA's loan programs and to provide funding for the SBA loan guarantee program, the SBA charges a guaranty fee for each loan approved. These fees range from 2.00% to 3.75% of the loan amount and are paid when the loan closes.

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Can SBA loans be re-paid at any time?


Yes, but there are penalties which need to be taken into consideration depending on the type of loan that has been acquired.

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What are the main types of SBA loans?

Several programs are offered by SBA and these include: 7a, the 504 programs, SBA Express, Patriot Express and SBA Community Express.

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How long does it take for an SBA loan to close?

Different lenders have different authorities depending on their SBA ranking and each loan is different but most SBA loans close within 30-45 days.

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If a piece of land is purchased and then planning approval to develop it into houses is acquired, would that busin ess qualify for an SBA loan?

This activity is considered speculative and does not qualify for an SBA loan.

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