SBA 7a Loan Guarantee Program
Do you have a profitable business but need a loan to grow and expand?
Do you have a plan for a new business with solid potential but need capital to get it started?
The Small Business Administration (SBA) 7a Loan Guarantee Program was created to help meet the needs of small and medium enterprises (SME) with long-term, fixed and variable, flexible financing options. The SBA does not provide direct government loans or so-called free grants. They are your small business silent partner to help finance your enterprise.
Alternative Business Capital commercial strategic lending partners will fund SBA guarantee loans from $100,000 to $2 Million for start-ups and existing companies based in the U.S.
Business Loan Qualifications
- Retail and service businesses with 3 years sales projections and or history
- Wholesale businesses with up to 100 employees
- Manufacturers with up to 500 employees depending on industry
SBA 7a Loan Guarantee Size
- $100,000 to $2 million
SBA Guaranty
- Under $150K - 90%
- Over $150K - 80%
- SBA Express - 50%
SBA 7a Loan Fees
- One-Time Application Fee: based on lender (non-refundable)
- Loan packaging fee varies with lender
- Success Fee based on loan size
(points never exceed 3%)
- Success Fee is paid upon loan funding
- SBA Guaranty fee: 1.75% - 3.75% of the loan amount
- The higher the loan, the higher the fee
- Fee can be financed in the loan
Use of Proceeds
- Commercial real estate (purchase, construction or refinance)
- Leasehold Improvements, Renovation and Expansion
- Machinery, Equipment, Furniture and Fixtures
- Business Expansion
- Business Acquisition
- Debt Refinancing as part of the overall loan
- Permanent Working Capital as part of the overall loan
- Start-Ups (Franchises, Retail, Restaurants, Grocery Stores, Service Stations, Motels, etc)
Other Credit Considerations
- No past bankruptcies or felony arrests (exceptions)
- Good personal credit history required for all principles and guarantors
- FICO Beacon: 600 minimum (exceptions)
- Business must have adequate historic cash flow to cover the proposed debt
- Business debt to net worth must meet industry averages
- Owners/Borrowers must be actively involved in the day-to-day operation of the business
SBA 7a Loan Checklist
- Complete, Comprehensive Business Plan with;
(for new & existing businesses)
- Three (3) years monthly cash flow projections for 1st year, quarterly 2nd year, annually 3rd year
- Start-up balance sheet and income statement (for start-ups only)
- Three (3) years proforma income statement
- Three (3) years proforma balance sheet
- Hint: Have an Accountant help prepare the financial documents
- Historical Financial Statements (for existing companies)
- up to Three (3) years previous income statement (min. 1/yr)
- up to Three (3) years previous balance sheet (min. 1/yr)
- Hint: Have an Accountant help prepare the financial documents
- Breakdown of use of proceeds for proposed SBA loan
- Detailed breakdown of total project cost, including acquisition and contruction costs, leasehold improvements, equipment to be purchased, any debt refinanced, working capital and loan closing costs.
- Personal Resumes of all owners and key managers of the business
- Complete description of collateral to secure the proposed loan
- Signed, Current, Personal Financial Statements (within 60 days) for each business owner and guarantors
- Signed Authorization for credit background check on each owner
- Signed, completed application directly from the lender
- Alternative Business Capital (ABC) help you qualify for an SBA loan by getting you prepared in advance. This is key for an approval.
- Unlike other services, ABC place your loan with lenders that want your business, after you are prepared. There is only one credit check. There are no multiple credit checks, which will lower your credit score. There is a higher chance of approval
Are You Qualified For An SBA Guarantee Loan?
Do you need $100,000 - $2 Million?
Alternative Business Capital is not a lender. We do not provide sba loans. We are a service provider, consultant and referral source for preferred and certified sba lending partners.