Some of the best financing options for small businesses are SBA loans. The terms and rates are very favorable to small business owners. Although the SBA doesn’t actually issue loans, the organization just guarantees them, it allows small businesses to get better interest rates to compete with larger businesses. SBA loans have a longer repayment term and lower payments. However, SBA loans are very competitive. The process can take time.

What Documentation Will You Need For an SBA Loan?

SBA loans require the owners to put up a personal guarantee for the loan. This means that your personal credit score must be fairly good. Even with good credit, you’ll need a lot of business documents from the past three years:

  • Personal income taxes 
  • Business tax returns 
  • Personal financial statement 
  • Business lease, certificates, and licenses 
  • Loan application history 
  • P&L, balance sheets, cash flow analysis, etc.  

Your lender may need other information, too. Your lender may also want to see a business plan showing how you plan to use the money and how you’ll pay it back. Some SBA loans are only for real estate or for equipment purchases.

What Type of Lender Offers SBA Loans?

With an SBA loan, you still work with a lender, but the lender must be approved to process SBA loans. When you choose a lender, ask how many SBA loans the organization processes each year. Find out how experienced the staff is in dealing with SBA loans. You want to choose a lender who can help you through the process to increase your chances of getting a loan.

You may want to discuss your business with the lender before applying to make sure that you have the financial health to get approved. If your business is struggling, it may not be worth your time to apply. Contact Commercial Capital Funding for information about SBA loans for your business.