If you want to grow your business, then one of the best ways to do is to apply for federal grants or loans. This is what makes the SBA loans so appealing, because they are partially guaranteed by the US Small Business Administration. However, if you want to obtain them you will have to find a financial institution that offers them, as they can’t be obtained from the SBA directly.
What type of SBA loan is good for me?
There are 4 types of SBA loans and each one comes with its own set of characteristics that you have to oblige. You have the 7a General Small Business Loan, 7a SBA Express, CDC/504 Real Estate and Equipment Loan and finally the disaster loans.
The most appropriate one for small businesses is the 7a General Small Business Loan, as it can be used for a multitude of purposes, ranging from purchasing real estate to equipment or accessing capital, depending on the situation.
How to find the best SBA lender?
Before you acquire the SBA loan you will need to find a good, reliable lender. However since there are many such lenders out there is can be hard to find the right one for you, hence the need to find a good guideline to help you make the right choice.
Apply electronically
The largest SBA lenders will allow you to apply to the SBA electronically and get your loan pre-approved. Check if the lender offers such a service, as this will allow you to narrow down the list. Smaller lenders will want a face to face meeting. It just depends on what you want.
How much money you want to borrow?
Then, there’s the amount of money you want to borrow. Many lenders are offering you $150000 or less, but if you want more things can be a little tricky because not a lot of them can give you a lot of money. Find the desired amount you apply for and see if the lenders you want provide you with this amount.
Check online for approved lenders
A good source in this regard is actually the SBA website which you can find at https://www.sba.gov/tools/linc. You can easily find the local lenders and then sort them based on things like loan volume or proximity. There’s even a list of the 100 most active lenders on the market, so check that out as well. A great source to find an SBA lender is Checkrates.com by going here: http://www.checkrates.com/SBA/Mortgage/Rates
Ask questions
If you want to get the best experience, go and talk with the lending company directly. You can ask questions that pertain to the total SBA loan volume or if they participate in the SBA Preferred Lender Program, as this will provide you with a good insight and a great experience overall.
Experience
If a bank or any other lending institution has worked with the SBA for many years, then they are definitely the best choice you can make, as you will lower the overall risks tremendously.
Ask if they handle the paperwork
Most of the lending institutions will require you to handle the paperwork, but there are some that do that on their own. If this is important to you, then talk with the financial institution and see if they do such a thing or not.
As you can see, there are multiple methods you can use in order to find the best SBA lender! Try to follow our tips and you will definitely be able to create a list of good, trustworthy lenders that you can work with! Do that, and you will be impressed by the results! It's not as hard as you think to get an SBA loan.