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SBA Loans: Capital for a Range of Needs

Posted by Michael Horn on Wed, Mar 26, 2014 @ 03:41 PM

Operating and start up funds are essential and one of the great challenges for veteran entrepreneurs.  The following article from KeyBank is worth a read and offers some detail you might use for debt financing of your business.

At some point during their growth, many businesses need outside capital in the form of loans to sustain and accelerate that growth. Many banks offer a portfolio of loan products that are guaranteed by the Small Business Administration (SBA).  These loans are structured for a variety of purposes and, because they can  possibly be SBA guaranteed up to 85% of the loan value, they may have more  lenient underwriting requirements than conventional financing. 

“SBA loans are often misunderstood as ‘loans of last resort’ or having too much  paperwork. In reality, they’re a very good solution for many business financing needs.”  — John Moshier, Senior Vice President and National SBA Segment Manager at KeyBank

SBA loans require a history of profitability or solid positive projections with  sufficient documentation. Applications require a business plan, sales and cash  flow projections, among other documentation. In exchange, your loan may have  more favorable interest rates than conventional loans and may require less  collateral. Working with an SBA-designated “preferred lender” can streamline the  application process, since such lenders handle a high volume of SBA loans and  can guide you through the process.
These government-backed loans are not one-size-fits-all, and your lender will also guide you to the right SBA loan product for your needs. Various loan programs include the following.

  • 7(a) loans
  • 504 loans
  • Express loans
  • Veteran-focused loans

KeyBank’s Moshier advises business owners and managers to look carefully at the lender they choose to ensure that the institution is designated as a preferred lender. Such banks have been vetted by the SBA for their knowledge of SBA products and this can result in finding the best fit for each business’s needs.

Read the entire article at the following link.

Topics: Veteran, Entrepreneurs, Resources, Vets, Loans, Entrepreneurship, startups