How to Get an SBA Business Loan
The SBA, a government agency, is an excellent resource to find funding for your small business. However, the SBA itself does not make loans, it simply guarantees them so lenders are more willing to extend a loan to you. The SBA business loan process is somewhat complicated, so it is a good idea to seek guidance from a local SBA advisor.
- Look up what is needed for a business loan on the SBA website. The website has information how the SBA works and how to obtain financing with their assistance.
- Contact the local SBA district office and schedule an appointment to meet with an advisor.
- Meet with an advisor and ask for guidance applying for a business loan. Writing a competent business plan and the loan process can be complex and somewhat daunting. An SBA advisor can guide you through or refer you to someone else.
- Choose which loan program to apply. The SBA has many different loan programs. Each program is tailored toward specific industries or communities with fairly narrow qualifications, so make sure to carefully choose the program for which your business is eligible.
- Prepare all the necessary documents. The SBA guidelines require extensive documentation. You must submit such items as a business plan, all related financial statements, personal and business histories, tax returns, licenses, list of all business owners or investors and more. Please consult the SBA website or a local SBA advisor for the details involved with submitting the correct documentation.
- Fill out an application. Applications are available from lenders, local SBA offices or even online. However, because the SBA programs widely vary, seek advice from your local SBA office or an SBA specialist at a lending institution. The application and related documents are submitted to the lender, who in turn submits them to the SBA.
- Wait for a decision. The decision to approve or reject a loan is made entirely by the lender. If your application is not approved, ask what needs to be improved and if you may resubmit it. You can also reapply through a different lender.
- Remember that although the SBA guarantees the loan to the lender, you are still fully and personally responsible for paying back the loan.