SBA Guaranteed Loan
The SBA, or Small Business Administration, is a Federal Government Guarantee Program that incentivizes banks to make loans to businesses who would otherwise not qualify for various reasons, such as, lack of time in business, experience or personal liquidity, or poor credit history etc.
The SBA incentivizes partner banks by guaranteeing between 75% – 90% of the principal loan amount meaning the bank’s risk in case of default is only between 10% – 25% of the outstanding principal loan balance at the time of default.
SBA Guaranteed Loans are commonly used by business owners and entrepreneurs to purchase owner occupied real estate, acquire a business or franchise, to purchase equipment and obtain working capital for growth.
Eligibility Test
Unlike conventional loans, businesses must first meet SBA eligibility standards prior to applying. The two most important eligibility tests are tangible net worth and net profit. All businesses applying for an SBA guaranteed loan must possess less than $15MM in tangible net worth or $5MM in net profit for the fiscal year prior to submitting the application.
There are other eligibility requirements that will be addressed in future episodes.
My SBA Loan Pro
The My SBA Loan Pro Podcast is hosted by Your SBA Loan Pro, Ryan Smith. In each episode Ryan provides valuable information and best practices regarding the SBA loan program.
Each episode is approximately one minute in length and addresses topics related specifically to SBA 7(a) and 504 loan programs to purchase real estate, acquire a business or franchise and obtain working capital.
You’re encouraged to listen and subscribe to ensure you’re notified each time a new episode is available. Ryan publishes a new episode weekly on Tuesday mornings, unless he’s kidnapped to a deserted island of course.
You can listen and subscribe on your favorite platforms including Apple Podcasts, Spotify, Google Podcasts, Anchor and Stitcher.
Simplifying The SBA Loan Application Process