An SBA 7(a) Loan is an easy and inexpensive way to finance your small business. The top level of this program provides loans of $150,000 or less; for more information on larger loan sizes see the SBA 504 Medium Business Loan Program . A maximum loan amount of $5M can be financed with a combination of SBA 6 forms of financing.
The SBA 7(a) Loan program provides “Shore Up” capital for small businesses that are experiencing financial difficulties, or that do not have adequate equity to obtain loans through conventional sources. The basic purpose behind this loan is to enable entrepreneurs with limited access to the equity markets, the opportunity to establish or purchase a business. The program is designed to make funds available quickly, while minimizing the financial risks for SBA and its lenders
Applying for an SBA 7(a) Loan has never been easier. There are two easy steps involved in applying for an SBA 7(a) Loan:
- Step 1 – Determine that You Qualify
The first step in applying for an SBA Loan is to determine if you qualify; that determination does not necessarily mean that funds will be available for you. If your business qualifies, the next step is to complete the necessary forms and submit them to the lender of your choice.
To apply use Business eXpress (BizX), which is a web-based application that guides you through the loan process. You can also print and fax the Loan Form to your lender of choice. That lender will then follow up on your information and help complete your application within ten days.
- Step 2 – Contact Your Lender
Your lender will provide you with any necessary application forms, discuss the terms of your loan, and answer any questions you may have.
To find a lender near you use our lender locater tool. There is no fee to contact lenders listed on BizX or for lenders who are participating in SBA’s partner programs. After the first two contacts, if both parties are interested in pursuing financing, there may be a fee involved; ask your lender for details.
- Step 3 – Sign Your Loan Documents
You will need to provide copies of financial statements and other related documents to complete the application process with your lender. The Closing Disclosure which includes all fees paid by the borrower is an important document so please read it carefully.
If you have any questions about the loan signing process, please contact your lender.
- Step 4 – Get Your Loan Funds
After your small business has been approved for financing, you will need to wire or otherwise send a check from your account payable to SBA for an amount equal to the loan closing costs listed on your Closing Disclosure. SBA will then pay the funds directly to your bank for payment of fees, costs and expenses associated with your loan transaction.
If you have any questions about wiring instructions or other aspects of the process, please contact your lender. For further information on the application process go to step-by-step guide.
How can I get an SBA 7(a) Loan?
Credit Unions, Community Banks and other lenders that participate in the program can provide you with information about their requirements. However, it is to your advantage not to get pre-qualified by a lender until you have completed Steps 1 through 4 of the application process because income tax returns and financial statements will be necessary. Completing the steps will help you determine if you are eligible for an SBA Loan and how much it might cost.
For assistance locating a lender, use our Lender Locator tool . There is no fee for initiating contact with lenders listed on BizX or for participating in SBA’s partner programs. After the first two contacts, if both parties are interested in pursuing financing, there may be a fee involved; ask your lender for details.
How much does it cost to apply?
There is no fee to apply for an SBA 7(a) Loan through BizX or via our partner programs. However, you should understand that there may be a fee – ask your lender – if you choose to use a different network of lenders. After the first two contacts, if both parties are interested in pursuing financing, there may be a fee involved; ask your lender for details.
How long does it take to find out about my application?
That depends on how it’s submitted. After you have completed all the steps, please allow a minimum of 10 days to submit your application and for lenders to review it. Loans may be finalized in less time depending on lender requirements.
Can I work with more than one SBA lender?
Yes, although there is no need since BizX provides access to all lenders that participate in the program, and your application will remain active with all lenders for 60 days.
The SBA’s Guaranty Fee Disclosure Exemption Notice states: “SBA will use reasonable efforts to ensure that a financing source is aware of the borrower’s intention to finance at least once every 120 days.” This means if you do not receive any financing offers within 60 days you should contact the lender that has already reviewed your application to discuss updates.
What are SBA Express loans?
SBA Express is an alternative to the Standard Program with streamlined underwriting and approval process. Maximum loan amounts are capped at $350,000 for businesses in rural or underserved areas and $5 million for all other loans, including commercial real property.